21 replies to this topic

[mab01uk]

Apparently Austin Rover was required to give confidential commercial information to its principal rival, Ford, at the height of merger talks in 1986 and Ford saw the production costs of every Austin Rover model. They claimed that it allowed them to engage in a discount war in the showrooms that summer, which gave the Ford Fiesta a 7.4 per cent market share compared with the Austin Metro’s 4.5 per cent. Before the talks the Metro had outsold the Fiesta.......At the time the DTI refused to comment on whether any government pressure had been applied on Austin Rover to enter into the reciprocal arrangement on the exchange of confidential information.

http://www.aronline....ions-go-public/

Edited by mab01uk, 11 March 2017 - 07:44 PM.

[Scousemouse]

We all know the Conservatives hate anything that is considered as being "OWNED" by the public ie GAS/Electric/Railways/Airlines and the No1 on their list...the NHS.

That's a really underhand thing that was done to Austin/Rover,to deliberately force a State Owned Car Manufacturer to hand over sensitive info to run it down in favour of a PRIVATE Car manufacturer is a disgrace. This should be made public knowledge,and any living politician involved brought to book!!

[Van13]

Not surprised (wonder who got a big fat back hander for negotiating this )

[Cooperman]

By 1986 Austin-Rover, or whatever it was calling itself that week, were effectively finished. They were propped up by public finances and were losing money on a day-by-day basis.

 

Ford were wise to not have got involved and BMW were very foolish to have allowed themselves to buy the shambles, which was after B.Ae. had a go at making it work, but at least BMW got the 'Mini brand and name which has seen them with some sort of advantage.

 

Austin-Rover never seemed to understand marketing, whereas Ford always have. Ford don't compete with themselves and they produce cars which people want at prices they are prepared to pay. The later Rover 200, 400 & 600 series were excellent cars, but the marketing strategy was badly flawed. I have had a 214Si, two Rover 600 models and a 420i. All very good and nice to drive, but the target markets were badly defined. Then there was the poor way in which ARG dealt with their supplier chain, failed to pay invoices within a reasonable time and made poor decisions. The trades unions didn't help either.

 

Why would Ford have made any sort of an offer without full disclosure by ARG. It's called 'due diligence' and as ARG was largely gov't funded it is natural that the gov't would insist on full disclosure being available. If Ford had made any sort of offer without full disclosure by ARG then the Ford executives would have been guilty of negligence. I have been involved in acquisitions of companies and full disclosure is always required.

 

It is the press which doesn't seem to understand how the sale of businesses works and use 'sensationalist' headlines in order to sell newspapers.

[r3k1355]

1986 also saw the introduction of a larger fuel tank and a 5-speed transmission on all Fiesta models making base models attractive, sales of the XR2 were also strong.

 

BL (in it's various names) didn't need any help to fail, they were quite capable of doing that all by themselves.

Edited by r3k1355, 13 March 2017 - 04:51 PM.

[Big Sam]

We all know the Conservatives hate anything that is considered as being "OWNED" by the public ie GAS/Electric/Railways/Airlines and the No1 on their list...the NHS.

 

No, they love things being owned by the public, just not us. Lots of utilities and big business in this country is owned by state control companies from around the world. Just odd.

[Cooperman]

It should be noted that the FoMoCo/ARG proposed deal was not a 'merger'. It was to have been an acquisition by Ford for which they would have had to pay money.
Now who would buy something without being able to see exactly what they were buying?
One might presume that when Ford saw the figures they walked away - or ran maybe.

[mini-geek]

The biggest issue with every industry in this country is the refusal to invest in the future or move with the times..
We seem he'll bent on looking back instead of forwards (I won't mention brexit but ins sure some will know what I mean)

If the MK1 fiesta hadn't out sold the metro the MK2 and mk3 would of..

Edited by mini-geek, 13 March 2017 - 06:30 PM.

[Scousemouse]

Ford love the UK that much It's a wonder the Transit hasn't got a Turkish Cresent for a badge.

[Cooperman]

Ford are a multi-national company and they are surviving in a tough world.
They have responsibilities to their shareholders.
They produce vehicles in many countries - that's what being multi-national means.

[r3k1355]

The biggest issue with every industry in this country is the refusal to invest in the future or move with the times..

 

Actually one of the largest issues with industry, and especially ex-state industry is the ******* terrible state of the pension plan that they all come saddled with.

Any takeover or sale is lumbered with a ridiculous amount of pension debt which sours many deals.

 

The resulting pinch on finances is then further encumbered by **** management of the ex-state industry which leads to poor investment and general poor performance.

Edited by r3k1355, 14 March 2017 - 12:29 PM.

[Spider]

Secrets or not, Ford have a business plan and internally, is ruthlessly adhered to. If it doesn't pay, then it's not done. Pure and simple.

 

Going back in Rover's history, right back to the Austin and Morris merger in the 50's was where the seeds were first sown for this company's demise.

 

I believe they had marketing, different to that of Fords, but it would appear that BMC had no accountants to be seen anywhere. Their cars were dreamed up, made on a whim, then sold to compete against what they saw as competitor's models at an under cut price.

 

They had NO idea in the world if they were making or loosing money. On the other hand, Ford knew on each car that rolled out the door exactly what it cost them to the 0.001. 

 

It's amazing that BMC / Leyland / AR / Rover lasted as long as it did.

[mab01uk]

The Mini was Britain's best-selling car ever, with more than five million purchased over the years. But its sales success disguises a surprising story - consumers got a much better deal on the Mini than they should have done.

Ford bosses were mystified at how it could be produced for such a bargain basement price, so they decided to take one apart to see how on earth it had been done.
Former Ford Product Planner Bob Howe recalled: "We analysed the Mini, we dismantled the thing completely even to the point of breaking spotwelds and we costed every component.
"Based on our analysis, Ford would have incurred £35 of cost over and above the price they were advertising it at".
It looked as though every Mini was costing £535 to make and then being sold for £500.....
http://www.bbc.co.uk...siness-13285504

[Spider]

I recall Stuart Turn also mentioned similar numbers in his book 'Twice Lucky', when talking about his time with Ford and how after coming from BMC is was quite a culture shock that he had to make and keep comprehensive accounts.

 

Interestingly too, I recall seeing some sales charts for the Mini over various years from the 60's and 70's. The years where the Mini sold best was when BMC / Leyland also made their biggest losses. Obviously, this doesn't show the whole picture and clearly, they had models which they did make money on.

[r3k1355]

It's amazing that BMC / Leyland / AR / Rover lasted as long as it did.

 

They were backed up by the government, everytime they fell over the government stepped in and bailed them out.

 

Unfortunately when that happens there is no punishment for bad practice, so all the bad managers and executives remain when they should have been sacked years ago.

In the end it went on so long there weren't many people left in the company who actually knew how to run an effective motor business, bad practice was the only practice.

 

The Mini/A-series is a prime example, they produced the sodding thing for over 40 years, mainly because they couldn't ever do any better.

Edited by r3k1355, 05 April 2017 - 11:59 AM.