Both companies have struggled to contribute to Ford’s profits – Jaguar was blamed for many of the losses suffered by the Premier Automotive Group this year, and it’s clear that the blue oval no longer wishes to hear excuses about poor X-type sales, exchange rate issues and a slow American market. Will it move production to America, the car manufacturer’s largest market? Many industry watchers believe that’s the obvious solution, while others desperately claim this will deprive the brand of its Britishness so beloved of American buyers.
Well, that’s a myth. US consumers have no perception of Jaguar – or Land Rover – as a ‘British’ brand. And their success, or lack of it, in America is not simply down to the exchange rate. One analyst told us that Jaguar’s success depends on the model – its look and performance.
The problem is, the brand has not carved a niche for itself and potential buyers believe it has too much in common with the Ford-owned Lincoln.
Back in the UK, the factory closure will result in more than 1,000 job cuts. Land Rover’s Solihull plant is facing a similar uncertainty. Assembly of the new Freelander has already been promised to the Halewood plant in Merseyside, despite Ford executives agreeing to its latest efficiency programme.
Land Rover has succeeded on the back of its perceived reputation of durability and off-road vehicle ability. But on the road, the company has been beset for years by quality issues. Thankfully for dealers, buyer loyalty to the brand seems to gloss over these glitches and sales in the UK have remained buoyant (as they have in America thanks to Land Rover’s name and cache, although sales could struggle if fuel prices continue to rise).
As news leaked out about Ford’s dissatisfaction with Solihull, the Birmingham Post website set up a forum for its local readers to write messages of support for the beleaguered workers.
Well, that backfired, with the vast majority of messages condemning the plant for poor practices and shoddy workmanship. Tales of woe flooded through from former workers, while customers recounted their own bad experiences of Land Rover ownership. The forum was removed from the website after just a day.
Land Rover and Jaguar’s problems are endemic of a wider potential crisis affecting the Midlands area. MG Rover, another car manufacturer that is suffering intense media speculation about its future, has been downsizing its Longbridge plant, selling off surplus land and reducing production levels.
For a company which stated that for Longbridge to become efficient and the business to break even it would need to make 200,000 cars a year, it is falling well short (2003: 145,000). The knock-on effect is spelling disaster for local suppliers who are seeing their business eroded.
All three car manufacturers could do worse than take a trip to plants operated by their Japanese counterparts, Nissan in Sunderland and Honda in Swindon. These operations are among the most efficient in the world thanks to flexible working practices and modern facilities.
The trade unions will cry foul, but without greater efficiency and productivity, the Land Rover plant at Solihull could follow the closure of Browns Lane.