MG, the Birmingham-based British carmaker owned by China’s Shanghai Automotive (SAIC), will by the end of the year begin producing its first all-new car in 15 years, and from 2011 relaunch in the UK as a “value” brand.
The company, which mainly provides design and engineering services for SAIC’s growing Chinese operations, will in the fourth quarter of this year begin assembling the MG6 at its Longbridge plant.
The first cars will be made from knocked-down kits brought from China. However, if the new model proves successful, MG plans to increase the amount of assembly it does in the UK – and thus give new life to what was once one of Europe’s largest car plants.
MG has given London-based advertising agency DCH a brief to remind carbuyers of its heritage, without dwelling on sepia-tinged nostalgia for models made by MG Rover, which went into administration in 2005. “We’ve got to get across the idea of having a great past with a bright, exciting future”, says Guy Jones, MG Motor’s UK sales and marketing director.
When MG Rover collapsed, SAIC bought intellectual property rights to some of its cars and engines. Much of its production equipment was packed up and shipped to Nanjing Automobile, with which SAIC has since merged.
At the time, its top engineers set up a consultancy with Ricardo to advise SAIC, which the Chinese carmaker bought in 2007.
The site employs 300 engineers and about 30 design staff, and has developed or contributed to several SAIC cars, including its Roewe 550 model, which went on sale in May. It also did work on Roewe’s 350 saloon and the MG Zero, a “concept” car SAIC unveiled at the Beijing auto show in April that will form the basis for a new small car.
China’s carmakers are becoming more proficient at producing smaller and cheaper cars but struggle to compete with foreign brands in designing larger, higher-specification cars. None has yet scored a big export success in western Europe or the US. “There’s still a lack of capability in Shanghai, and probably will be for years, to design a new vehicle from a clean sheet of paper”, says David Lindley, head of SAIC’s technical centre.
With its main focus on China, MG currently only makes its TF sports car in tiny volumes in Longbridge. The car is a rebooted version of a design produced before MG Rover went into administration and has struggled to compete with comparable models with more up-to-date features.
While its then-owner NAC spoke of selling 50,000 cars a year when the vehicle was relaunched in 2007, the company now acknowledges that sales have been “in the hundreds, not thousands”.
MG is hoping for more success with the MG6. It says that potential buyers of the car in customer clinics have compared it with Ford Motor’s Mondeo, Skoda’s Octavia, or even a small BMW.
While the company shrinks from comparisons with other low-priced car brands, Skoda, Kia and Hyundai have been among the industry’s best-performing marques during the downturn. “Desirable cars and affordable prices is a good combination for a post-recession period”, says Mr Jones.
The company will sell the MG6 in a five-door fastback version, followed by a four-door saloon, and sell it for ￡16,000 to ￡20,000 – a modest price for a car of its size. If MG manages to revive its brand in Britain – and later in Europe – it will have ample room to expand on the sprawling Longbridge site, whose facilities include a mothballed paint shop.
MG’s rebirth on booming car sales in China is part of a wider trend across the car industry, where the country’s rise as the world’s largest vehicle market has redefined the business. Elsewhere in Britain, Changan – another large Chinese carmaker – recently set up a research and development centre in Nottingham due to employ 200 people by 2013.
While MG Rover’s failure hangs heavily over its Chinese-owned successor
