MG Rover on brink of China deal

[fedsron2us]

MG Rover is on the brink of a £1bn deal with a Chinese company that will help secure the future of its giant Longbridge plant.

Under the joint venture with the Shanghai Automotive Corporation, a new company will be set up to produce cars for the fast-growing Chinese market.

http://news.bbc.co.uk/1/hi/business/4027839.stm

This being described as the end of British owned volume car production even though Rover in the past was once part of BMW. There is a certain irony that a business that been both nationalised then privatised in the UK has found its way into the ownership of a Chinese state owned corporation. If Shanghai Automative can actually make this profitable they will succeed where many previously have failed. I suspect that what they really want is get their hands on is the design expertise that still exists amongst British vehicle engineers. Interesting to note that Asian management seems to be able to get British workers to make cars for a profit whilst American and British management teams so singularly fail in this task. It just goes to show that soon the new masters of the world will no longer reside in Washington or London.

on edit - Interesting to note that MG Rover builds cars in the West Midlands where there a lot of marginal seats in the UK Parliament. Indirectly the Chinese government is going to acquire quite a bit of political leverage on its UK counterpart.

[non sociopath skin]

1. A model for the future?

"Interesting to note that Asian management seems to be able to get British workers to make cars for a profit whilst American and British management teams so singularly fail in this task. It just goes to show that soon the new masters of the world will no longer reside in Washington or London."

Now that wouldn't have anything to do with differences of pay and conditions between West Midlands and Shanghai workers, would it, Feds?

The Skin

[fedsron2us]

2. I agree, but Rover had already tried outsourcing the production

of the City Rover to Tatia in India. Although workers in the Asian sub-continent were far cheaper the project was a failure because the Indian built car simply failed to find any British buyers. Price alone is not the only factor in the auto market. Build quality, style and reliability are all important. Rover has been singularly underachieving in all these areas recently. Its also important to remember that most of the major Japanese, European and American motor manufacturers are already building vehicles in China. Given this fact I find the argument that the Chinese need our technology a little hard to swallow. The more I look at this deal the more I see a political as well as business strategy unfolding. Maybe I am just getting paranoid.

[LibLabUK]

3. Hmm

The CityRover was actually more expensive than the other cars in it's field, and offered less features. It was an absolute disaster.