Conference terri::cars_uk

    This was the largest Rover note...
    
    I heard a one-liner on the news this morning:-
    "British Aerospace are to sell their share in Rover to BMW for 8xx
    million pounds"
    
    This was a complete surprise to me, if anyone I would have expected
    Honda to be the favoured. There would seem to be major conflict of
    models from bottom to upper middle.
    
    Andrew

    
    Maybe BMW will reposition the 3 series upmarket and use the Rover 
    range as the lesser range. Or maybe they just want to have a breadth
    of range (not everyone who'd buy a BMW would buy a Rover and vice
    versa).
    
    BTW if you want to talk about conflicts Honda would seem an order of 
    magnitude worse than BMW as most Rovers have almost EXACT equivalents 
    in the Honda range.
    
    Pity to see the last British mass production car maker go the way of
    all the others, though.
    
    Mark

    
    The Sunday Times carried an article last weekend that Honda were 
    supposed to be increasing their stake in Rover to 40%.
    
    Wether it's BMW or Honda, it certainly seems that British Aerospace
    don't want them!
    
    Richard.

I thought it WAS Rover's long term aim to become "The British BMW".

    
    You may or may not know now that BMW HAVE bought 80% of Rover Group
    (including Land Rover) from BA (This is their whole holding).
    
    The price was �800m apparently and BMW are stating that Rover will
    continue as an independently run concern with their own product range.
    
    Honda DID want to buy around 47%, but apparently BA needed more cash
    than that would raise and took BMWs offer instead.
    
    Only time will tell if this is a good or bad thing for Rover.
    
    Mark  

re the last couple of notes.

I don't know why exactly, but I have a bad feeling about all of this.

Clive

    This is already being discussed in 793.322 onwards (though I think it
    does deserve its own topic).
    
    Andrew

    Excuse my ignorance: what's BA's share of Rover in % ?

80% BAe and 20% Honda before the takeover by BMW (see .-2)

    ... and this means that they also own 80% of Land Rover as well.  I
    also have a very uneasy feeling about this one.
    
    Maybe Solihull could do a management buyout...

    Well, this is called EU ... 
    
    Things are bought by the ones who have cash ... A couple of years ago 
    the same thing happened to the French helicopter industry (Aerospatiale
    Helicopters Division, Marseille Marignane). Being No 1 in the world
    (NOR + units sold + exports) did nothing for them : they're now (the
    main body) part of the European company Eurocopter which is mainly held
    by DASA which is Daimler-Benz group (No 1 European industry).

Someone had to start this one off, so should the Japanese have increased their
stake in ROVER or is it good news that BMW have now got it.

Taking into account jobs etc etc etc .




						St

    BMW Mini? No I don't think so. Goodbye old friend :-(
    
    And what about the Rover 600. Rover designed this as a BMW basher, will
    BMW really let them continue to build it?
    
    I predict that Rover models that come into the BMW price range will not
    be replaced, and that the 400/200/100(100=Metros in some countries)
    will be retained as the cheapies. The oldies (Maestro/Montego/Mini)
    will be dropped as soon as the dust has settled. The Land Rovers should
    be safe as I don't belive BMW has offroad models.
    
    Andy

    
    Price wise, a loaded 800 is well below a loaded 5 series. Maybe BMW see
    this as a chance to broaden their product range (ie a 'cheap' executive
    car and a BMW executive car)?
    
    Interesting to hear that BMW have plans for the old names. Maybe we'll
    see something like the Z1 in production as an MG, Triumph or Riley in 
    the future.
    
    Alternatively, maybe BMW would like to concentrate their models
    upmarket (even the 5 series can't really be seen as upmarket these
    days) a la Jaguar/Lexus, etc and will use Rover to provide the staple
    diet?
    
    Who knows? Presumably the bigwigs at BMW. Maybe we'll see in a year or
    two.
    
    Mark

    When the MD of BMW was interviewed on the news last night, and was
    questioned about the 'competing' 600 and 800 Rover ranges, he was
    fairly off-hand about it - basically said that superficially they were
    competition, but not really. 
    
    Confident or Teutonically arrogant ?
    
    Pete

    I'm very sad that BMW have bought Rover,I just hope they don't run it
    down.It makes me wonder just what we will be manufacturing in the
    future,probaly what ever it is it won't be British,because nearly
    EVERYTHING that we do well is bought out or made better by someone else
    after they have taken our idea. 
     The one thing I have read about the takeover is that Rover has not
    made a profit yet,and still has large debts....
    
    Tyrone
    

    What about Landrovers???
    
    
    Simon

    BMW took over Rovers 900 millon debts, as well as paying 800 millon for
    the co.
    
    Rover made 56 mil profit before paying 65 mil interest on its debts,
    and thus made a 9 mil loss.
    
    Dave D

    
    I think BMW + Rover is a better fit than Honda + Rover, who, to all
    intents and purposes compete directly with each other.
    
    Overall, I believe this will be good for Rover and good for the 
    automotive parts suppliers. Rover have just about the best working
    practices of any car plant in Europe and are the envy of most.
    
    The Rover 100,200 and 400 ranges all sit neatly below anything
    currently offered by BMW, whereas Rover have no competitor for the 
    '7' series BMW. Land Rover and Range Rover, if sold through BMW 
    dealerships as well, would sell more vehicles. A joint venture between 
    Rover and BMW in building a new upmarket 'mini' also makes a lot of sense. 
    
    Ford's takeover of Jaguar and Aston Martin has been advantageous
    to both British companies. Jaguar quality has never been so high
    and Aston have had money to invest in great new models like the DB7. 
    
    The GM takeover of Lotus turned out to be bad news for Lotus when
    the production of the Elan was stopped. GM though didn't have the
    cash to make the investments needed.
    
    Richard.
    

I (like the author of .19) take a fairly positive view of the take-over ... 
    the following may help explain:-

1)  BMW are one of the very few manufactures who only make rear wheel drive 
    cars.

2)  Rover outsold BMW - on pure volume - last year.

3)  The majority of the Rover volume is accounted for by partly or almost 
    totally Honda platform cars.

    So to get any return on their investment, BMW will need to:-

1)  Invest in front drive Rover (and therefor non BMW) platforms and 
    running gear (suspensions).

2)  Maintain the high productivity (and investment) level in Rover - in order 
    to maintain the market share they have spent a lot of money on acquiring.

3)  Integrate BMW bits (engines and gearbox internals) into the the new 
    - non Honda - platforms.

In summary, I do not see how the take over makes business sense with any kind 
    of asset striping or non investment scenario. In short - good news.

                                   Regards,

                                    Nick.

    Has anyone yet walked into a BMW dealer and asked to order a ROVER ?
    
    Has anyone yet tried ordering a BMW from a ROVER dealer ?
    
    
    
    Is there anyone in DEC Germany who can contribute to this note ?
    
    Regards... Bryan

    I think this buy-out will be good for Rover, although I must confess I 
    feel sad that the last major British car manufacturer has gone.
    
    The BMW image could be either a good or a bad thing, depending on how you
    look at it. It might deter many Brits, but I think Rover sales
    will definately increase in Germany (as happened to Seat and Skoda when 
    VW bought them).
    
    Land Rover is a hell of catch for BMW - has it ever been unprofitable?
    The BMW Turbo Diesel will probably go into the next Range Rover, as too
    might the new BMW V8s. 
    
    BMW is very much more up-market in Britain, than it is here (as anybody
    whose been to BMW dealers in both countries will tell you!), so BMW
    gain a huge market percentage in the UK - I reckon they'll be expecting
    Rover customers to 'move-up' to BMWs rather than the British equivalent
    (Jag? or maybe the top spec 800s - although, as was mentioned earlier,
    a top spec 800 does not compare pricewise to a similiar spec 5 series).
    
    It would have been nice if Rover had stayed independant and achieved 
    their aim of becoming the British BMW - but, the press kept hinting
    that offers were being considered, so I suppose it was only a matter of
    time.
    
    Al.
    

re .21

WHat are you on about? Have you ever walked into a VW
dealer and ordered a SEAT or SKODA? 

I believe the company's will keep their own labelling
so we won't see equivalent BMW/Rover cars. What would be
the point?

I think it's a good move. I personally don't care whether
the company is British or German. 


	Ian

RE: -.1

Our local VW dealer (SWitzerland) sells the full range of Seats.

-Stev

    Agree with 2 replies back...
    
    In Fareham... You can walk into the Rover dealership and by a Seat...
    as in the same dealership holds the 'franchise' for both types of
    vehicles.
    
    Stephen

Yeh, like you can walk into Hadleys in Basingstoke and
buy a Rover, Peugeot, Citreon or Toyota - but they are all 
separate dealerships (kind of).

I can't see what all the fuss is about - I mean have Jaguar 
suffered greatly from the Ford buy out?

As for the replies a few back. I can't see the Mini going
away for a while yet. It's still a big seller, particularly
in Japan. Just because the 600 competes with the 3 series
doesn't mean one should be stopped - it is the same
company making or losing money from both models. If BMW
have any sense, they'll leave Rover pretty much alone 
seeing as it's one of the few successful manufacturers
at the moment. I guess it all depends on what Honda
decide to do, or what BMW decide to do about Honda.

Ian

I wonder if the purchase of ROVER by BMW will provide the support and
distribution network for Rover to re-enter the US market?  I know that you can
buy Range Rovers here, but I can't tell you where a dealership is within a 100
mile radius of my location.

If some of the BMW dealers were to pick up Rover Francises, it might be viable
for Rover to sell cars here, too.

Perhaps then I could pick up some parts for my MGs from the local dealer instead
of some mail order house 3000 miles away.  Oh to dream...

-Al

    The chairman of BMW said on TV the other day that Rover getting back
    into the US was one of the aims of the new tie ups.
    
    Question is, do Rover still sell MG parts ?
    will there be enough money in it for them to ship MG parts to the US,
    hold and distribute them across the dealer network, when there not
    getting money in from selling cars for these parts ?
    
    Dave D.

    
    Re Rover parts.
    
    I got some A35 wishbone bushes from NIAS last summer (or probably the 
    one before, now I think of it) within a day, so MG parts are probably
    easily available from Rover.
    
    Mark

    MG & Triumph "consumables" are still available off the shelf (at
    least here in Switzerland). Any major parts or body parts need to be
    ordered from Moss or other reputable people in the UK.
    
    Paul

    
    Judging by a recent European league table of labour costs, Sunday
    Times (I think), in which the UK is substantially lower than Germany 
    BMW must also be thinking of the advantages of manufacturing in the UK.
    
    With Rover's quality and strike record it's now a low risk way to reduce
    costs.  If I were a Rover employee I'd feel pretty secure now.

RE: MG parts.

Lots of parts that I order from Moss, or the other big suppliers in the US have
"Rover" stickers on them.  I'm not talking about engine blocks or body sections;
I mean things like brake parts, throttle and choke cables, and other little bits.

-Al

    Perhaps I'm wrong then...
    
    but if they set up a large dealer network in the US, this would mean a
    large central warehouse, plus distribution and then each dealer holding
    some parts for a small,diminishing market.
    
    would get them some good press with some people though.
    
    Dave D.

>>    
>>    but if they set up a large dealer network in the US, this would mean a
>>    large central warehouse, plus distribution and then each dealer holding
>>    some parts for a small,diminishing market.
  
That's correct.  Some of the parts may fit newer models, as well, though.

At least I would be able to order from them.  Right now I order from Moss, who 
orders from Rover (if Moss is out of stock).  There is an extra step and extra
cost in there, I would expect.

-Al  

    Talking of MG's,I heard on Oxford Radio this morning that an MG museum
    may be built in Abingdon,the home of MG.
    
    Tyrone
    

    Back to the Rover take over.
    
    According to the Munich press, BMW reckon they've got an absolute
    bargain. They paid 2 millionarden (is that two thousand million??) 
    Deutschmarks, for that they move into several markets that BMW
    currently do not occupy - small cars, off-road, lower market segment,
    with a product that is already profitable (or would be if the interest
    on the British Leyland debt didn't have to be paid)
    
    Al

    Re. Rover MG Triumph parts..
    
    Aren't they sole sourced/distributed through UNIPART?
    
    Tim

    Well I'm happy about this deal. 
    
    My biggest fear was that BMW would abandon Rear wheel drive and follow
    the front wheel drive brigade.
    
    They won't have to now. They can segment their market by product:
    
    Front Wheel Drive = BMW = capable, sporting driver
    
    Rear Wheel Drive = Rover = incapable, average driver
    
    Result = increased market share without canabilising their bases.
    
    Rupert 8^)

    >>    Rear Wheel Drive = Rover = incapable, average driver
    
    I'm sorry you'll have to explain the joke, my Rover is front wheel
    drive :-|

    And all the BMW's I know are rear wheel drive except when they've spun
    that is :-)
    
    	Rik-average-front-wheel-driver
    		Except when the Prelude's spun - and it has...

       
    Maybe Rover will be able to offer a course to owners of their cars to
    enable them to drive like BMW drivers.
    
    You know, like the car in front of you doing 20 mph less than the speed
    limit is a 740 and the car 2 inches off your bumper, with his full
    beams on, is a 318!!!! :^)
    
    Mark
    
    PS Just a thought (courtesy of my wife), if Derek Mitchell still worked
    for Digital, he'd be driving a BMW now! :^)

    
    As I see it what Honda had to offer Rover was lessons in Quality and
    productivity, what Rover had to offer Honda was a way of selling more 
    cars in britain (re-badged and assembled here) and the mutual gain was 
    from the economies of scale I.E. one chassis design investment sells 
    more cars, and commonly shared parts. This Bmw take-over seems in my 
    eyes to make the Honda/Rover partnership redundant I can't see Honda 
    giving all it's bright ideas to BMW, or vice-versa! I think that Honda
    will sell it's share or at least sever technical links with Rover and
    just be a silent partner.
    
    Or maybe BMW is going to buy Honda next or vice-versa. 8*)
    
    Richard

    I had an interesting conversation with my brother last night - he works
    for Honda. They sent of of their guys up to Rover yesterday to remove
    all Honda's software and designs from Rover's CAD/CAM machines.
    He claims that Rover will not be able to make any modifications to any
    of their models for quite a while...
    

    ref. -.38
    
    Yes, i got it completely face about ar*e, or is a*se about face.
    
    Anyway, i think you knew what I meant!
    
    Rupert 8^)

re .43

I doubt whether they'd legally be in a position to do that.
Seeing as Rover make some Honda models, I doubt whether
it would be wise for Honda to get on the wrong side of
Rover. 

It sounds like one of those nasty rumours that gets distorted
in any big organisation.


	Ian

    What Honda models do Rover make ?
    
    I know that Rover make cars which share (a lot) of common features with
    Honda (Rover 600 .v. Accord) but I thought they were manufacture in
    separate UK factories - one owner by Honda, the other BMW ne� Rover.
    
    I could accept that there are UK companies (Lucas etc) which are
    subcontracted to make parts for both Rover and Honda - but this is quite
    different.
    
    	Rik

I thought the 200 and Concerto came off the same production
line. I may be mistaken, but I'm pretty sure that the
body shells at least are made by Rover

The past couple of notes has me thinking...

Who needs more re-badged Hondas, anyway?  I hope that BMW buying the company will
allow Rover to engineer its own cars and perhaps become a supplier to markets
around the world.  I think that one reason that the stirling(Rove 800?) did
poorly in the US is that is was percieved as nothing more than a Honda with a
nice English interior (leather and wood vs cloth and plastic) at a much higher
price.

If this happens, there will be a large startup up cost in terms of designing new
models, but I think it would be worth it.

The story of the British Car industry is a sad one, indeed.  I read an article in
magazine I get, called "MG Enthusiast", about the rise and fall of the industry.
It was amazing how fast markets grew then fell equally as fast after a few good
years.
 
-Al

    	The forecast by the motoring writer in one paper over the weekend
    was that in a year or two, only the Land-Rover engineering group would
    be left in the UK, the others having been shutdown and responsibilities
    transferred to Germany.  His view was that the main thing that BMW
    was after was be cheap labor.

This conflicts with a report on the news a few days back
where they said BMW workers were extremely well paid and
manufacturing in the UK may be a way of cutting labour 
costs.

I don't think that Rover will be 'allowed' to develop new cars. It simply costs
too much. The Honda Rover tie up allowed Rover to produce new car designs very
cheaply.

Some of the stuff that they did with the 200 - the Cabriolet, the Coup�, and
the wider engine range was quite impressive, considering the constraints they
worked with.

Mark.

    Rover, even when they were British Leyland Cars never had the
    investment needed to produce radical new ranges. The first Metro was a good
    effort given the fact that they had really outdated A series pushrod 
    engines to power them, and only about 300 million pounds of investment
    in the whole project. Compare that to Fords 2 billion just for the
    engines for the Escort!
    The new Rover 1400cc petrol K series must have been the first proper new 
    generation engine the company had in about 30 (million) years.
    I understand from a contact in the company that they are working on
    their own new range of diesels, having learnt from Perkins and
    Peugeot....could be interesting stuff.
    
    At the end of the day, multinationals will always shift resource/plant
    to where it maximises return on investment....not act as a social
    services to particular nations....look at Digital's record!
    
    Tim 
    

According to the Economist, UK average manufacturing labour costs are 
$14/hour, Germany's are $24/hour.

-Steve

Ah, but the report on TV was specifically about BMW workers
and the fact that they are extremely well looked after

.51> This conflicts with a report on the news a few days back
.51> where they said BMW workers were extremely well paid and
.51> manufacturing in the UK may be a way of cutting labour 
.51> costs.

   If this was referring to my .50, I was referring to the development
 groups only, so I don't see any conflict at all.

    Apparently the initial Rover/BMW discussions started around the fitting
    of BMW Diesel engines to the Landrover (Defender, Discovery, Range
    Rover) ranges.  This would not have impacted the Honda relationship.  
    
    Looks as though I've placed the order for my next lease vehicle
    (Discovery) several months too early.
    
    Tony

On the radio this morning it was stated that Honda have decided to end all 
relationships with Rover as soon as possible. There was clearly a strange 
meeting in Tokyo as the BMW came out sounding positive and the Honda guy came 
out and said it was all over.

Andrew

    ref.58
    Well, there's nowt so strange as folk.... especially business folk and
    politicians!  (or are they the same these days?)