How The British Car Industry Lost Out?

[anjan_c2007]

The British car industry was supreme all through the 1920's,30's,40's, 50's and even 60's.Great Britain was the leader in small and mid size cars, while the larger ones were left to the Americans. Some big car marques from the U.K. too excelled like Rolls Royce, Jaguar, Rover, Healey, Morgans and even Austins ( the larger ones e.g. Princess). Come the 1970's, many British companies losing the sales momentum and ran aground.The once famous marques started perishing. The first signs appeared with the closure or collapse of the The Rootes Group , makers of Hillman, Sunbeam, Talbot, Humber brands and British Motor Corporation (BMC), earlier Morris Motors. In fact Morris had become one of the largest car making conglomerates in the U.K. with Austin, Wolsley, MG, Rover and British Leyland under its ownership. BMC had a slice of government ownership since a few decades, that was done away with during the tenure of Ms Margaret Thatcher as the UK, PM.
The Japanese car makers gained entry in the 1970's due to the oil shock of 1973 and started firstly with exports and the establishment car assembly plants. They later established manufacturing plants and went into large scale manufacture in U.K.
The Japanese onslaught was too much to bear for the local industry. Their overheads were getting higher and higher, products neither fuel efficient nor maintenance free like the Japanese competition.
Morgan still remains British owned, while Rolls Royce, Bentley, Mini (left over of the BMC now with BMW) and now Jaguar succumbed and became targets of foreign takeovers, changing hands. Ford and GM (Vauxhall), both American companies however remain as they were and still sell very well in the U.K.
The erstwhile British car industry has been totally mauled and its sad to note that companies that were once very popular household names are just history now.
The two American companies have weathered all the storms, while the local industry has been decimated.This is also a mystery as to how the Big Two survived. may be their deep pockets helped as Big Brother in Detriot did the Sugar Daddy act.
The causative factors that led to the collapse of the once flourishing British car industry were perhaps huge overheads, shoddy quality, labour problems too and models that failed to meet the need of the times and face the competition.



Among the last of the British models under British ownership



The tell tale signs of an eminent collapse are imminent



Car sales in the UK were never so low

(The three pictures/ articles/ charts from Daily Express, 1983)

[libranof1987]

Nice read.

You mentioned how the Japanese onslaught brought down the British car companies; did European car manufacturers like the Italians, French and German play a hand in it as well?

[download2live]

There is a 4 part Documentary series by Jeremy Clarkson who went into depths of the demise of British car industry. I will scour my Hard Drives to see if I still have them.

Got one part on YouTube.
" Who Killed The British Car Industry "

Clarkson's Car Years Episode 4 - Who Killed The British Car Industry (Part 2) - YouTube

[Thad E Ginathom]

Originally Posted by anjan_c2007

The causative factors that led to the collapse of the once flourishing British car industry were perhaps huge overheads, shoddy quality, labour problems too and models that failed to meet the need of the times and face the competition.

Shoddy quality indeed. Back in the 1950s/60s, my Father's buying policy was, Never buy new: let someone else have the problems. The cars he did buy seemed to rust away in very few years. Brits were used to rust buckets that always held their owners in suspense as to whether or not they would start. Japanese reliability was a revelation!

[scopriobharath]

I am unsure about one thing -

Why was NOT japanese technology used by british. The British companies could have hired some Japanese people (who have worked for thier competitors) and brainstorm ideas from them, incorporate them into British cars and make money.

[anjan_c2007]

Originally Posted by libranof1987

Nice read.

You mentioned how the Japanese onslaught brought down the British car companies; did European car manufacturers like the Italians, French and German play a hand in it as well?

Coventry and Oxford, U.K. are ghost towns now.Yes indeed, none of the big French, German or Italian manufacturers perished in the 1970's and 80's.All of them are flourishing even now. Their equity holding patterns change from time to time, but they do not shut down their shutters. Fiat had a bad spell in 2005 but with Sergio Marchionne at the helm its bound to continue rocking!
In the earlier years during the 1970's and 80's, the Japanese imports (all non European Common Market entities rather) were taxed heavily. The Japanese thought of setting shop in the U.K. rather than export. But European imports could not be levied higher duties due to the treaty in force. Only now in 2011, a Swedish company Saab (now I believe it is GM owned) has fallen on bad times and has virtually no takers. But it is a small company compared to the giants in the U.K. that perished.

Originally Posted by Thad E Ginathom

Shoddy quality indeed. Back in the 1950s/60s, my Father's buying policy was, Never buy new: let someone else have the problems. The cars he did buy seemed to rust away in very few years. Brits were used to rust buckets that always held their owners in suspense as to whether or not they would start. Japanese reliability was a revelation!

Nationalisation, strikes, fights for social justice by labour unions(coal miners strike were so common in the U.K.) disinterest, lack of work commitment, motivation and bad quality control practices by the work force led to poor product quality.
The loss making car units were nationalised by the British Labour government in the 1960's. Nationalisation played havoc. In fact, till the founder-CEO's were at the helm the industry was doing well. Their demise brought the house down. Herbert Austin's death led to Austin being bought by Morris. It later on became BMC. Lord Nuffield's ( Sir William Morris earlier) death led to the near collapse of BMC that was nationalised.Sir William Lyons' demise ushered in bad days for Jaguar. In fact, much before his death the CEO was his nominee. Sir William was also looking after the management and owned the company till he passed away. But later on, it fell into bad days and Ford took charge. It could'nt change JLR's fortunes and now Tata is at the helm. I forgot to mention about Triumph and Standard in my first post, that were also a part of the BMC.
The government bail-out formula as practised by the Obama administration is working well. Chrysler is posting profits, while GM is again on cloud nine. They were on the verge of bankruptcy in 2009.Even sale of equity of a loss making car company to a healthy car maker (Fiat ownership of Chrysler now, Tata - JLR, Renault- Nissan) is a safer and time tested way to save the marque. JLR, Bentley, Mini and Rolls Royce have been saved from collapse by takeovers.But none are British owned.
In the U.K., government investments in the companies were immediately divested by the Margaret Thatcher's Conservative government's privatisation policy in the late 1970's and early 1980's to shed deadwood and fat, but that played havoc killing the companies.

[Thad E Ginathom]

Originally Posted by scopriobharath

I am unsure about one thing -

Why was NOT japanese technology used by british. The British companies could have hired some Japanese people (who have worked for thier competitors) and brainstorm ideas from them, incorporate them into British cars and make money.

I'm not good at history, but I did grow up in the fifties and sixties in UK, and I would say that that would have been quite contrary to the British psyche in private or business life. Britain was an island nation, and the fact that they had just won (albeit far from alone) a major war probably didn't do much for our humility. We were still proud of the big pink areas on the map even when I was at school, even though they were way out of date and the empire was gone. Much of Britain fought tooth and nail not to be part of the EU, or EEC or whatever it was called, and, even today, a Brit just does not feel European.

Japan was also seen both as a particularly hated recent enemy, and as a manufacturing nation that just copied others. Somehow, they managed to come through the phases of copying others but better to become innovators in their own right, without anybody noticing until it was too late. The Japanese car simply started on cold foggy mornings just as it did on bright sunny ones!

Management in the UK of that time was often a family affair. One managed because one inherited the job and the company. As a result, a lot of British management was really amateur and just plain bad. Bad management led to bad labour relations; bad labour relations led to over-powerful unions; reluctance to accept unions also led to lack of co-operation, and they were not able to take a positive role in management, because management would have died first. The Germans, I believe, had a very different and much more successful management/union interaction.

Thatcher was a snob who loathed her small-business background, hated industrial Britain, and only loved the world of finance and service industries, into which she sought to import American management style.

(This bit is personal: I detest her vehemently, not only because of what she did, but because I believe that she could have done so much good)

[shankar.balan]

What an excellent thread.
Thanks for creating it.

Whatever anyone may say, some of those brands and marques that the British created in the Automobile world were really top class and enduring.
Even motor racing at Brands Hatch and Goodwood etc was the preserve of the Aristocratic Amateurs.
I have that lovely book about the Bentley Boys which is so evocative of passion, nostalgia and class, not to mention money, and plenty of it!

[DKG]

I think Thad sums it up very well.

Over the past few years I have been buying parts for a vintage Rolls Royce from the UK and have been in touch with vendors for Austin parts and here's what I find.

Basically the British in general have a great mind when it comes to their ability to find solutions to engineering problems and if needed are adept at manufacturing anything. The tradition of machine shop brilliance that led to so many great marques come about in small outfits seems to thrive in a small cottage industry still. The calibre of workmanship on parts manufacture is top notch and given the newer machine shop technologies may even better the original component.

Where they seem to loose out, as Thad has mentioned, is in organising their business. They seem to do well as long as it's a small operation which can be managed by the owner. When it grows or they get too much business they just can't seem to get organised to handle growth. Those inefficiencies in scaling up appear as laziness to the customer but it's actually their inability to scale things up.

That said I admire the British mind in engineering and especially their ability to fabricate just about anything. That rich heritage survives and thrives in a tiny cottage industry.

If only the country as a whole recognises their innate talents and fixes their shortcomings you could very well see British industry bounce back. But it would entail a major pyschological shift in priorities and styles of management.

[dgupta]

Originally Posted by anjan_c2007

Coventry and Oxford, U.K. are ghost towns now.

Very true, I live in the ghost town. Although I have not seen the glory days of the British auto industry on my own, I hear similar stories from people at JLR who have been with the company for decades about the way things have gone down the slope. Some days back I was driving along with a colleague who has been with Jaguar since the 70's and he made a very interesting point about the Japanese takeover of the auto industry. I quote him "We being typically British mocked the Japanese cars calling them 'Jap Crap' while they being typically Japanese stood back, learned and conquered"

Originally Posted by DKG

Basically the British in general have a great mind when it comes to their ability to find solutions to engineering problems and if needed are adept at manufacturing anything. The tradition of machine shop brilliance that led to so many great marques come about in small outfits seems to thrive in a small cottage industry still. The calibre of workmanship on parts manufacture is top notch and given the newer machine shop technologies may even better the original component.

I would like to add an observation I have made through my stay here in the UK while studying and now working, I feel people here have a very "square box attitude" towards everything. What I mean by that is they cannot easily accept a new way of doing anything. Historical and accepted ways of doing a certain thing always dominate by default when you are trying to solve a new found problem. This in my opinion has led to a major crisis in the normal life of an average Briton post the onset of globalisation. They are constantly forced to leave their comfort zone to accept new ways of doing the same thing better and faster to compete on a global scale. I may appear bitterly critical of the british with my next statement, but bear with me, this comes from a collection of experiences in everyday life here in UK since 2010. Pride and delusional belief in their supremacy over any other society that ever existed or will ever exist on this planet is the prime reason for the collapse of everything that was known as "Great Britain".

[wantarangerover]

Why the British Auto Industry Collapsed?

1. Because the British were good at creating evocative marques, but failed miserably in mass produced, high quality vehicles in comparison to their Japanese brethren.

2. Unlike the French and many other people, the British does not have much sense of patriotism when it comes to buying cars. The French still buy Peugeots, Citroens and renaults even though there are many other better options around.

3. As many have mentioned, the best British brands stemmed out of small workshops run by ingenious folks who thought differently. But as the business ballooned, they lost out to bad management, planning and good leadership.

So in essence, Britain is a country living in the past glory, saying 'we won the war' and 'we beat you 5-1' to the germans, when in reality, their whole car industry is owned by foreigners. Even all the major football clubs have foreign owners. Britain is living on its erstwhile charm and empire glory, but it cant last forever.

[Thad E Ginathom]

Well, I think we have forgotten the empire glory bit, now. For a start, the multi-racial school rooms of today would never accept that pride in the pink areas on the map, and two generations of teachers have gone through two generations of change in social awareness.

Whilst Britain still has agriculture, I don't think industrial Britain would ever happen again. The infrastructure is long gone. You can run a factory that is updating old gear, bit by bit, but to start one fro scratch is just massive. There's the small stuff: the tech-park guys doing some genius thing with science and software --- but not mass production, at least not mass-employment mass production. Anyway, there's China. Even India can't beat China on that front: countries with basic wages many times higher can't even see the ladder, let alone get on it.

The latest British car tragedy was Rover. Ah! There was an example, a bit later in history, of Brits working with the Japanese, and I think that Rover was wrong to dump Honda. But the latest incarnation of Rover was producing some very desirable cars, and then? All down the drain in some management scam/snafu

[VeyronSuperSprt]

It is no wonder that almost all Formula 1 teams are mostly based out of Britain. They are of a small size, extremely cutting edge, do not need huge manpower but need lots of design and R&D capability. Sort of fits the British requirements to a T ! Wonder how they handle the laziness bit though as these have tight deadlines.

There's a joke about Julius Caesar invading Britain: it appears that the British stopped fighting at 5.00 pm and did not fight on the weekends. And the story goes: "Julius Caesar, cunning strategist that he was, started fighting after 5.00 pm and fought all day on the weekends!"

A pic is worth a 1000 words:

[VeyronSuperSprt]

For those who came in late, British Leyland were the owners of the following 17 marques:

1. Triumph
2. Standard Motors
3. Jaguar
4. Land Rover
5. Daimler
6. Mini
7. Austin
8. Riley
9. Wolseley
10. Lanchester Motors
11. Rover
12. Morris
13. Vanden Plas
14. Alvis
15. MG
16. BSA
17. Austin Healey

If the company had been managed well, this could have been by far the largest and most successful automotive conglomerate in the world !!

[invidious]

Wasn't Rover re-branding the 1st generation dud - Tata Indica and selling it as a re-branded City Rover? Talk about the Empire striking back.