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Transportation equipment industry

BMW Chairman Blames UK Government Policy for Rover Decision

Strategic Insights

— 1 min read

UK government policy on the pound and the question of whether the UK would join the euro contributed to BMW's decision to sell Rover, according to BMW's chairman, Joachim Milberg. The sale of Rover marks the end of British car manufacturing under the brand. Land Rover, a part of the Rover group, has been sold to Ford for $1.85 billion, with BMW retaining the Rover and MG sports car brands and a body-pressing plant in Oxford. Alchemy Partners has taken over most of the remaining business, with a potential for significant job losses at the Longbridge plant.

Key Takeaways:

  • BMW's chairman, Joachim Milberg, attributed the decision to sell Rover to UK government policy on the pound and the euro.
  • The sale of Land Rover to Ford marks the end of British car manufacturing under the brand.
  • BMW retains the Rover and MG sports car brands, as well as a body-pressing plant in Oxford.
  • Alchemy Partners has taken over most of the remaining Rover business.
  • The Longbridge plant, taken over by Alchemy, may face significant job losses.
  • Rover made losses of almost £745 million last year, 26 percent worse than in 1998.
  • Ford plans to maintain Land Rover as a best-in-class vehicle and has experience with luxury brands like Jaguar and Aston Martin.
  • Union leader Bill Morris welcomed Ford's decision to buy Land Rover.
  • The decision to sell Rover was made in the light of BMW's new strategy, with Ford's approach welcomed by Prof. Milberg.
  • A new Rolls-Royce plant will be built in Britain at a location to be decided by the end of this year.

Statistics:

  • Rover made losses of almost £745 million in 1999.
  • The Rover group sold Land Rover to Ford for $1.85 billion.
  • Frog has a workforce of 9500 and produces around 166,000 vehicles per year.
  • Rover's Longbridge plant may face significant job losses.
  • BMW's chairman, Joachim Milberg, expressed confidence in Ford's ability to maintain Land Rover as a best-in-class vehicle.
  • Ford's brands include Jaguar, Volvo, and Aston Martin.

Sources:

  • "BMW Chairman Blames Government Policy for Rover Decision" by The Times, no date (original article cited as "Exchange rate policy and euro dithering sparked move says BMW boss")
  • "Ford to Buy Land Rover from BMW" by Reuters, 1999-02-25
  • "Rover Made £745 Million Loss Last Year" by BBC News, 1999-02-25

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