The Fall of MG Rover
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Case Details:
Case Code : BSTR166
Case Length : 16 Pages
Period : 1975-2005
Organization : MG Rover
Pub Date : 2005
Teaching Note :Not Available
Countries : UK
Industry : Auto and Ancillaries
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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MG Rover Seeks Bankruptcy Contd...
Commenting on the collapse of MG Rover, Tony Murphy, national officer for the automotive industry at Amicus6 said, "Yet again I'm having to write an obituary for another stalwart of the British engineering and manufacturing industry. The loss of MG Rover is devastating news for the UK car industry…"7
Background Note
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Headquartered at Longbridge in Birmingham, UK, MG Rover specialized in the
production of cars under the brand names of Rover and MG. The MG Rover Group was
formed through grouping, regrouping, mergers and takeovers of many famous
companies in the British automobile industry.
The Rover Company was founded in 1877 when John Starley and William Sutton
formed a partnership to manufacture penny farthing cycles8
and tricycles. The name 'Rover'was first used for one of their tricycles
produced in 1884. After introducing several motorcycles, the first car was
launched in 1904.
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In 1906, the partnership was transformed into Rover Company Limited. Production
of cycles, motorcycles and cars continued up to World War I when Rover
produced military vehicles, mortars and gas shells under government
contracts. During World War II, the company employed more than 21,000 people
who produced aero engines, tank engines and aircraft wings. In 1967, the
Rover Company merged with the Leyland Motor Corporation (LMC), headed by
Donald Stokes (Stokes).
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During the period when the first Rover car was
launched, Herbert Austin founded the Austin Motor Company at Longbridge
in 1905 for manufacturing Austin cars. William Richard Morris (later
known as Lord Nuffield) founded Morris Motors Company and produced his
Morris Oxford car in 1913. In 1924, Cecil Kimber, General Manager of
Morris Garages (MG), who had great interest in body styling and coach
building in addition to being an enthusiastic sports car driver, tried
fitting the Morris chassis9 with
special bodywork of a more sporting nature. The first MG car -a
four-door saloon body on a Morris Oxford chassis - was born... |
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