Edited by Clive Goldthorp

Got a story, or link to one on the web? Email Clive Goldthorp at news@aronline.co.uk.

Top stories

1 March : News digest

2 March : Geneva Auto Show preview

6 March : News digest Geneva special

7 March : Ratan Tata: talking in Geneva

8 March : K-Series owners welcome the five-year headgasket

12 March : Dr. Gao: MG goes global

16 March : Top Gear BL special cars spotted...

21 March : News digest

26 March : Tata buys Jaguar in £1.15bn deal

30 March : News digest special - TATA Motor acquires Jaguar and Land Rover

News digest special

Compiled by CLIVE GOLDTHORP

TATA Motors acquires Jaguar and Land Rover

Classic names are part of Tata deal
Tony Lewin, Automotive News Europe 27th March, 2008

Tata Motors will get the right use three classic British auto-brand names as part of its £1.15bn deal to buy Jaguar and Land Rover. Included in the deal are the Rover name and the Jaguar-owned names of Daimler and Lanchester. Ford bought the rights to the Rover brand name from BMW in September 2006 for an undisclosed sum to ensure no other automaker could use it and cause confusion with the Land Rover brand.

"We acquired the Rover trademark in the interests of protecting Land Rover," said Ford of Europe spokesman John Gardiner. "So it's also in the interests of the new owner of Land Rover to have it." BMW obtained ownership of the Rover name when it bought the Rover Group in 1994. In 2006, BMW refused a request from China's SAIC to use the Rover brand name under licence. SAIC had bought some assets of the ailing MG Rover Group and now builds cars called Roewes in China.

Jaguar acquired the rights to sell cars badged as Daimlers in 1960 from the UK Daimler car company that was founded in 1896 and licensed by Gottlieb Daimler to use his internal combustion engine. The UK Daimler car company also owned the Lanchester brand name.

LEADER: Jaguar goes to Tata,
The Financial Times 27th March, 2008

Tata’s £1.15bn successful bid for Jaguar and Land Rover has propelled India’s biggest vehicle-maker on to the international stage. The company famed for making the world’s cheapest car has acquired two of Britain’s prime luxury marques. Ratan Tata, Tata’s chairman and the driving force behind its global ambitions, believes it can succeed where Ford, the previous owner, failed. He faces a monumental task.

The sale of Jaguar and Land Rover is a strategic withdrawal for Ford, which in recent years has had to subsidise losses in Jaguar. It is profitable in Europe and can now focus on its core US car business. By contrast, Tata’s appetite for global reach is as strong as ever. It has risen beyond its domestic roots to become the undisputed standard bearer of India’s push overseas, possibly at the expense of India’s own industrialisation.

The combination of a lossmaking Jaguar and a profitable Land Rover poses a sterner test for management than last year’s acquisition of the Anglo-Dutch steelmaker Corus, to which Tata can marry low-cost production of raw materials. With Jaguar, the challenge is whether Tata has the resources – and patience – to save a brand that has been in decline for 40 years.

Tata would be advised to learn from Ford’s mistakes, particularly in the managing of the Jaguar brand. The US company miscalculated badly when it sought to turn Jaguar into a high-volume producer, making a car based on the mass market Mondeo. Tata should exploit Jaguar’s traditional appeal: a distinctive blend of style and power that could sell well in expanding Asian markets. The new XF model, developed on Ford’s watch and a sleek replacement for an S-type in need of a makeover, could be the fillip it needs. Tata’s decision to stick to current business plans is logical.

Even so, it is hard to see how anyone can turn a struggling manufacturer into a world-class business in a country where the industrial base has shrunk dramatically. The decline and collapse in 2005 of MG Rover, the UK’s last mass car producer, shows that fusty design and high labour costs carry a heavy price in a fiercely competitive automotive industry.

Tata has won plaudits from trade unions by insisting that it will not “Indianise” the British brands. But it is likely to have to cut costs, despite a pledge not to close down factories in the UK before 2011. Tapping its own cheaper engineering and development expertise is an obvious early remedy. More drastic action may yet be needed if Jaguar is to survive and prosper.

Tata pledge on UK car plants
The Financial Times,
Jonathan Guthrie in Birmingham, Joseph Leahy in Mumbai and John Reed in London, 27th March, 2008

Tata Motors has promised to keep Jaguar and Land Rover's three UK plants and two product engineering sites open until at least 2011 as part of its winning bid to buy the two carmakers, it emerged yesterday. The Indian group's pledge appears to have played a decisive role in securing unions' endorsement of its £1.15bn bid for the two brands, which will see Ford Motor continue to supply them with engines, components and technology, and its credit arm to provide vehicle financing for up to a year.

The purchase marks a new peak for global acquisitions by India's expansive companies, led by the Tata group, one its oldest and biggest conglomerates. Bankers believe there will be many more such deals as cash-rich emerging-market companies take advantage of the downturn in the west and a slump in activity by private equity firms to buy up some of their better established but struggling rivals.

Tata's pledge - at a meeting with unions in London in November - was welcomed in Britain's West Midlands region as giving breathing space to Jaguar and Land Rover factories that have been regularly tipped for closure. In a cost-conscious industry where rationalisation and relocation to lower-cost countries are common, the plants produce only about 300,000 vehicles.

Jaguar is losing money, but Land Rover is profitable. Unions succeeded in pressing Tata to pledge broad support for the carmakers' existing five-year business plan. Dave Osborne, national secretary for the car industry in Britain's Unite union said: "Tata has confirmed there will be no changes to the manufacturing and product development footprint under the business plan, which runs up to 2011."

"That is good news for the employees and the UK economy." Tata said: "It is true, as per the business plan agreed between the management of Jaguar and Land Rover and the unions, and it is based on assumptions made in that business plan." Aniket Mhadre, analyst with Centrum Broking in Mumbai, said: "In the short term, it's very negative for Tata Motors, primarily because Jaguar is lossmaking."

Tata is said to have made no specific commitment to maintain the two brands' staffing at its current level. However, Ford said it did not "anticipate any significant changes to Jaguar/Land Rover employees' terms of employment on completion" of the deal, expected by mid-year.

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Tata buys Jaguar in £1.15bn deal

BBC, 26th March 2008
Car giant Ford has sold its luxury UK-based car brands Jaguar and Land Rover to Indian company Tata.

A new jewel in Tata's crown...

Tata, India's biggest vehicle maker, is paying $2.3bn (£1.15bn) for the British brands after months of negotiations over price and supply relationships.

The negotiations started last June when Ford announced its intention to sell the companies as a package.

Jaguar and Land Rover employ about 16,000 staff at UK plants in the West Midlands and Merseyside.

Although Land Rover remains profitable, Ford has never managed to make money from its investment in Jaguar.

Ford has been forced to sell the two companies in order to concentrate on its loss-making core US car business, which it hopes to turn around in the next two years.

The $2.3bn price tag is about half the amount Ford originally paid for the marques, leading some analysts to argue that the purchase was a mistake.

"How can you call it anything else?" said Erich Merkle, an auto expert for US consulting company IRN.

"You have to cut your losses at some point. It's been draining them of cash and resources."

Ford sold its iconic Aston Martin marque to a UK-led investment consortium in a deal worth $955.2m last year.

No significant changes

The companies said there would not be any "significant changes" to Jaguar or Land Rover employees' terms of employment on completion of the sale.

They said that staff, trade unions and the UK government had been kept informed of developments and supported the move.

Tata said the deal should be completed by the end of the summer, subject to applicable regulatory approvals.

The purchase will give Tata the opportunity to expand its presence in the passenger car market beyond India and gives it the clout necessary to compete with international players.

In January, Tata launched the world's cheapest car, the Nano, priced at $2,500 (£1,250).

By contrast, the starting price for Jaguar's latest sports car, the XF is more than £32,000 ($64,000).

Ford retrenches

"We are very pleased at the prospect of Jaguar and Land Rover being a significant part of our automotive business," Tata said.

"We have enormous respect for the two brands and will endeavour to preserve and build on their heritage and competitiveness, keeping their identities intact.

"We aim to support their growth, while holding true to our principles of allowing the management and employees to bring their experience and expertise to bear on the growth of the business."

Alan Mulally, the president and chief executive of Ford, said he was "confident" that the brands would continue to thrive under Tata's stewardship.

"Now, it is time for Ford to concentrate on integrating the Ford brand globally, as we implement our plan to create a strong Ford Motor Company that delivers profitable growth for all," he added.

Terms

Under the terms of the deal, Ford will contribute about $600m to the Jaguar and Land Rover pension plans.

Ford will continue to supply Jaguar and Land Rover for differing periods with engines, stampings and other car components, in addition to a variety of technologies.

In addition, Ford Motor Credit Company will provide financing for Jaguar and Land Rover dealers and customers during a transitional period of up to 12 months.

"It seems as though they have resolved some tricky supply issues," said Ernst & Young's automotive expert Eric Wallbank.

"The deal will give Ford the cash to revive its fortunes in the US and focus on its core brand, while it adds an important plank to Tata's automotive ambitions," he added.

News digest

Compiled by CLIVE GOLDTHORP

1) TATA and Jaguar/Land Rover

As Tata/Ford deal progresses, the question still is 'Why'?
Neil Winton, Detroit News 8th March, 2008

LRX Concept will be a prize asset for Tata...

THE Geneva Motor Show press days came and went without the expected news that India's Tata had agreed to buy Jaguar and Land Rover from Ford. But if and when the deal is finalized the question will still remain; why would any company want to buy a serial value destroyer like Jaguar and barely profitable Land Rover, which carry the additional baggage of being gas guzzlers in a world enacting savage new fuel economy rules?

When it became clear last year that financially ailing Ford was serious about dumping Jaguar and Land Rover, one automotive publication summed it up like this: "Home for clawless cat wanted. Ford may be about to throw limping Jaguar and Land Rover to the wolves."

The wide range of estimates of the money such a sale would raise -- from Merrill Lynch's £650m to Citigroup's £4bn -- reflected the difficulty potential investors had in valuing these two flawed British icons. Some thought Ford would actually have to hand over cash to finally see the back of these two storied marques.

Since buying luxury sports saloon maker Jaguar for £1.6bn in 1989, Ford has lost close to £5bn, including the purchase price. Land Rover, which makes big SUVs like the Range Rover and Discovery, and the smaller LR2, is thought to be profitable at the moment, but not making enough money to finance a product renewal programme.

Krish Bhaskar, who heads the Motor Industry Research Unit (MIRU), based in Nice, France, thinks there is only one way for the deal to add up, and that is to switch production to India to take advantage of much lower costs. "Everything will go to India, otherwise it doesn't make any sense. It's pointless to keep production in the UK, just look at the pound, dollar and euro (exchange rates)," Bhaskar said.

Tata chairman Ratan Tata was quoted as saying in interviews at the Geneva show that he had no plans to "Indianize" Jaguar and Land Rover and would leave the management largely intact. "We are not looking for a company in which we make a drastic change (in management)," Tata told the Financial Times. The British media and trade unions have interpreted this as meaning that everything will remain more or less the same in terms of management and production.

Bhaskar is not so sure. "It doesn't make sense to produce in Europe for the U.S. any more. It has to move to India," Bhaskar said. Tom Donnelly, Professor of Automotive Business at Coventry Business School, has a much more upbeat view on the possible deal, and thinks it will lead to a center of engineering excellence in the British Midlands. "Tata has been talking about opening an R&D centre in the Midlands, although nothing has been signed and sealed, but if agreed this could mean a high technology cluster for the auto industry here, and with Formula One near here as well, this could be great for Loughborough, Birmingham, Warwick and Coventry Universities," Donnelly said.

Donnelly thought it made sense for Tata. "Tata wants to be a global player and wants to make vehicles in virtually every segment. It would be silly for it to develop its own luxury brand; what credibility would that have? Like GM with Saab, you buy the real thing," Donnelly said. Jaguar and to a lesser extent Land Rover have been the victims of flawed business plans over the years, Donnelly said.

During the Ford years of ownership Jaguar was plagued by derivative design and a failure to develop new markets. Even when cars like the flagship XJ sedan were flaunting the latest aluminum body technology, the body designs were dull. The X-TYPE was supposed to lead Jaguar into higher volume sales and to compete with the likes of the BMW 3-Series. In 2001, when launching the X-TYPE, Jaguar talked of sales reaching 150,000 a year, with overall sales reaching 200,000, maybe 300,000 a year. Last year Jaguar's overall sales came in at 60,485 -- 19 percent lower than in 2006 -- although that reflected the run-out of the S-TYPE, now replaced by the XF.

Jaguar fell into the habit of constantly having to catch up with developments from Audi, Mercedes, BMW and now Lexus, rather than leading the way. Even the new XF, now being launched around the world, appears to have dated engines and chassis compared with the German and Japanese leaders. Land Rover has done many things right, but the Range Rover and its slightly smaller Discovery sibling are chronically overweight with sector-trailing fuel consumption at a time when carbon dioxide emissions are headline news. Last year Land Rover sales rose 18 percent to about 225,000. The long-range target had been 250,000, according to Donnelly.

Dr. Peter Wells, Reader at the Cardiff Business School, said the Jaguar X-TYPE was seen as a rebadged Ford Mondeo and was wrong for the brand, but he does believe the future under Tata has promise. "Both have strong brands and great potential. Jaguar is moving back into cutting-edge styling (with the XF) and there's lots of scope. Tata may have the imagination to think of different ways forward, and the future lies as much in the East as here in the West with developing markets like India and China. In these countries Jaguar and Land Rover have strong reputations and brand recognition. Tata is a very strong, powerful and innovative company with a lot of resources behind it," Wells said.

Professor Ferdinand Dudenhoeffer, Managing Director of Bochum, Germany based B&D Forecast, said Ford never had a chance with Jaguar and Land Rover because it came from the old car world, and had no experience running premium brands. Things might be different with Tata. "I think the mixture of British engineering and Indian software skills will generate a turnaround," Dudenhoeffer said.

MIRU's Bhaskar believes that if Tata buys Jaguar and Land Rover it might well be a long-term success, but it will mean the end of any large- scale British-owned automotive business. "It has to move to India, and that means the direct workforce of about 22,000 goes and the wider supplier industry involves about 200,000. The knock-on effect will kill UK suppliers, and kill the UK-owned automotive industry. This is the killer blow," said Bhaskar.

Budget: Land Rover and Jaguar hit in new measures.
Jonathan Walker, Political Editor, Birmingham Post 12th March, 2008

Motor manufacturers in the West Midlands are to be hit by green taxes costing their customers up to £735m a year. ore than half the vehicles currently produced at Land Rover's plant in Solihull and Jaguar's plant in Birmingham will be liable for charge of £550, under proposals unveiled by Chancellor Alistair Darling. Mr Darling said the fee was part of a package of measures to protect the environment, as he delivered his first Budget.

But manufacturers accused the Chancellor of using green issues as an excuse to raise taxes. Figures published by the Treasury showed that the measure, which comes fully in effect in 2010, would raise an extra £735m annually. Mr Darling announced that owners of gas-guzzling vehicles which cause the most pollution are to be charged a new rate of vehicle excise duty of £950 for the first year – up from £400 now.

They will then be charged £455 annually, an increase of £55 a year on the current levy.

The top rate of tax will apply to vehicles which produce 255g of C02 emissions per kilometre – more than 60 per cent of the vehicles manufactured by Land Rover and Jaguar. Other vehicles which produce more than 140g of CO2 per kilometre will be liable for more modest increases. Last night a spokesman for the firms, both owned by motoring giant Ford, said they would aim to introduce cleaner vehicles by the time the changes came into force.

The spokesman said: "At the moment, 61 per cent of our vehicles would be liable for the top rate of duty introduced in Mr Darling's budget. "But by the time the measures come into effect, it should be much less. We have invested £700 million in new technology to produce cleaner vehicles. "At this point, we cannot predict how many of the vehicles we produce will be affected."

The two firms employ 12,000 staff in the West Midlands, producing more than 200,000 vehicles a year. The Society of Motor Manufacturers and Traders accused the Chancellor of using the environment as an excuse to tax motorists. SMMT chief executive Paul Everitt said: "Trying to force people out of high-value cars has no environmental merit and will be seen as a smokescreen for revenue-raising."

Tata Motors faces rising costs for Ford brands
Automotive News Europe 17th March, 2008

Faced with rising borrowing costs as a global credit crunch deepens, India's Tata Motors Ltd is keen to close a deal to buy Ford Motor's Jaguar and Land Rover luxury brands by the end of this month. At the same time, Tata also needs capital to help pay for the manufacture of its Nano, the world's cheapest car, due for launch in the second half of this year.

According to announcements and media reports, Tata could be raising up to £2bn on domestic and overseas debt markets. "It's just a matter of time now ... Tata will obviously want to do the [Jaguar/Land Rover] deal by March 31 so they can account for it this fiscal," said PriceWaterhouseCoopers partner Abdul Majeed, referring to the close of the 2007/08 financial year.

"Clearly, because of the liquidity crunch, a deal now will be more expensive than they'd initially planned for." The cost of borrowing overseas has risen 200-300 basis points since last July, analysts said, when the first reports of Tata's interest in the Ford luxury brands appeared. "It's a staggering sum of money, which will undoubtedly put pressure on the ratings," said Anshukant Taneja, primary credit analyst at Standard & Poor's in Singapore.

Ratings agencies cautioned in January, when Tata Motors was named the frontrunner by Ford, that a large burden of debt for the acquisition could trigger a possible downgrade for the company, which already has an ambitious capital expenditure plan. Elizabeth Allen, senior analyst at Moody's Investors Service, reiterated that view, adding "the $1 billion that Tata is looking to raise is only one piece of the puzzle".

The Ford brands acquisition is expected to cost around £1bn, media reports have said, and Tata needs more money for other alliances and to build manufacturing capacity in India for the Nano. Last week, Tata Motors said it planned to raise up to $1 billion in overseas and/or domestic markets. Also last week, the Financial Express said Tata mandated State Bank of India to raise £1.5bn in overseas debt, and wanted the funds by April 10.

A spokesman for Tata Motors declined comment on a timeline for the acquisition or the Financial Express report, which said Citibank, Standard Chartered, BNP Paribas, JP Morgan, Bank of Tokyo-Mitsubishi UFJ and Mizuho Financial Group would "pool the resources". The Jaguar/Land Rover acquisition, Tata Motors' biggest to date, could be done through holding company Tata Sons -- which has stepped in on big acquisitions in the past -- to maintain a favourable debt-equity ratio, said Rishi Sahay, director at IndusView Partners.

"Taking on a big chunk of debt on their books won't be good. And these brands have very poor cash flow," he said. Tata Motors shares, which trade at 14.8 times forward earnings, have a market worth of £2.95bn. They have fallen about 20 per cent, in line with the broader market, since it was named frontrunner for Jaguar and Land Rover. "Since the shares have also taken a hit, bankers may be a bit uncomfortable given the circumstances," Sahay said.

The Ford deal would give Tata Motors, India's top truck maker, a bigger international presence. Last year, Tata Steel Ltd made India's biggest overseas acquisition, paying £6.5bn for Britain's Corus Group. Despite possible integration challenges with its range of sturdy trucks and functional passenger cars, Tata has a good track record on acquisitions, said PWC's Majeed.

"They're known to proceed only if they are convinced of the merits and synergies," he said. "And they're not known to overpay."

Tata ties up £1bn deal for Land Rover and Jaguar
Duncan Tift and John Duckers , Birmingham Post 14th March, 2008

The deal to transfer ownership of Jaguar Land Rover to Indian company Tata Motors will be signed on March 26, industry insiders have indicated. There had been speculation that an announcement would be made sometime next week but the matter has now been deferred until after Easter. Sources confirmed today that all negotiations connected with the protracted deal, estimated at around £1bn, had finally been concluded.

One industry watcher said: "It’s a very complex document, running into hundreds of pages." It is thought that the formal announcement will be made at a press conference in London, although full details could be delayed until the second quarter. The expert said: "It’s all done and dusted. It’s great news for the Midlands. It’s a total agreement taking in all the unions and staff.

It is believed that Tata has guaranteed the Jaguar Land Rover investment plan for the next five years – an assurance that confirms the continued production of the famous marques in the UK. Details regarding supply contracts and engine provision remain secret for the time being. Unions had been urging Ford to agree to continue supplying engines for the vehicles, a move that would guarantee the jobs of thousands of workers in the components industry.

While some of the Ford engines are manufactured in Germany, the bulk are supplied from the company’s plants in Bridgend in South Wales and Dagenham. It is believed that continuing arrangements have been agreed. Claims were made on Thursday that Tata was seeking price guarantees from Ford for the engines in an attempt to keep costs as low as possible. Tata has been looking to conclude a funding package needed to finance its takeover.

The Indian company is thought to have approached a network of banks around the globe with a view to raising £1.5bn, enough to finance the initial deal and provide basic working capital. Tata has promised to respect the heritage of both brands and agreed to continuity of management. To this end, it is believed Jaguar Land Rover chief executive Geoff Polites will retain his position after the deal goes through.

Sources close to the deal said: "There has been a lot of speculation over when the deal might be concluded but March 26 would correspond with the Ford timetable of securing the deal by the end of the first quarter." News came on the day that new figures showed both brands had struggled for European sales in February. The latest car registration figures from European car association ACEA showed Jaguar sales down 25.6 per cent in February compared with the same month last year, while Land Rover showed a decline for the second month in succession, off more than 12 per cent.

Jaguar sold 1035 cars in the Western European region compared with 1392 last year. Despite the poor performance the decline was less marked than last month when the figures showed a 37.9 per cent drop. Land Rover sold 4081 models last month, compared with 4644 in February 2007. In the UK as a whole, sales were down 5.4 per cent compared with the same month last year, at 69,610 versus 73,586.

However, there was brighter news for the UK industry from BMW where the MINI showed its continued popularity with sales up more than 50 per cent compared with last year. The Oxford-manufactured car had sales of 9924 last month versus 6606 in February 2007.

Across Western Europe as a whole, sales were up 7.7 per cent.

2) SAIC Motor MG and Roewe.

2008 Roewe 750
China Car Times 11th March, 2008

The 2008 version of the Roewe 750 will be launched on the 20th March 2008. Roewe fans will be pleased to know that the 2008 version doesn’t really have much difference to it, other than the front light water jet cleaners have been removed. Is this a case of Project Drive all over again? In January Roewe built somewhere between 10 and 30 cars (varies, according to source) but sold 651 Roewe 750s in January.

Roewe 750 2.5 V6 drops in price, cheap as chips!
China Car Times 13th March, 2008

The Roewe 750 2.5 V6 model has fallen in price by a staggering 32,000rmb. The cheapest model now starts at less than 200,000rmb, Roewe are offering potential customers loans that come with one year interest free.

The cheapest Roewe is now 190,980rmb for the 2.5 V6 inc leather seats, GPS, DVD and all the usual goodies. The 2.5 V6 prices have been slashed by 32,000rmb across the board to improve sales, and to make room for the 1.8T Roewe 750 which will be priced at 180,000rmb and up when it goes on the market this month.

3) MINI

Fiat buys Chrysler powertrain plant in Brazil
Ryan Beene, Automotive News 12th March, 2008

Chrysler LLC said today it sold its Brazil engine plant, Tritec Motors Ltda., to Fiat Powertrain Technologies. Fiat purchased 314 acres, production lines, equipment and licenses to produce the plant's current range of 1.4- and 1.6-litre four-cylinder engines.

Fiat said the plant would produce a new range of mid-sized gasoline and flex-fuel engines, according to a Reuters report. "Today's announcement is great news and provides a stable future for Tritec under the ownership of Fiat Powertrain Technologies," Chrysler co-President Tom LaSorda said in a statement. The deal was valued at about £67m, according to a Reuters report. Chrysler spokeswoman Mary Beth Halprin declined to confirm the sale price, saying Chrysler does not typically disclose financial details as a private company.

The plant was built in 1999 through a 50-50 joint venture between the former DaimlerChrysler and BMW AG established in 1996. The engines were supplied to the BMW Mini car from its European introduction in 2001 and U.S. launch in 2002 until it was replaced for the 2007 model year by an engine developed by BMW and PSA/Peugeot-Citroen.

Tritec engines also were used in the Chrysler PT Cruiser sold in South Africa and Europe and Neon models sold outside North America. DaimlerChrysler assumed outright ownership of the project when it bought BMW's 50 percent share of the joint venture in July 2007. By that point, press reports indicated that Lifan, a low-volume Chinese automaker, and Russia's AvtoVAZ were thinking about buying the plant.

4) India Watch

Report: Tata wants stake in Ferrari,
Automotive News Europe 7th March, 2008

Indian businessman Ratan Tata would like to acquire a stake in Fiat's sports car unit Ferrari, said Finanza & Mercati, citing a Tata interview in the weekly L'Espresso publication. Tata already has an alliance with Fiat for his India auto operations, while Finanza e Mercati said Tata is already allied to Italy's Benetton group and furniture maker Poltrona Fraum, it said.

"I have two passions in my life: cars and aircraft. I have always dreamed of being able to be a fighter pilot and I confirm the desire to participate in the shareholding of Ferrari," Tata said. "Luca di Montezemolo (Fiat and Ferrari chairman) has invited me to look around in Italy because his country offers a lot of opportunities in the design and luxury sectors," he said. "Montezemolo has made me curious. We have the same vision, we buy the same things," he said.

Tata is also a Fiat board member. In 2006, Fiat hiked its stake in Ferrari to 85 per cent, buying back stakes sold to financial investors, and has an option on a further 5 percent sold to Arab Emirates' Mubadala Development. According to Finanza e Mercati, Fiat can buy the Mubadala stake between January this year and July 31 under the option deal at a prefixed 121.2 million euros, less any dividends paid out.

GM plans to launch second small car in India
Automotive News Europe 17th March, 2008

General Motors wants to launch a second small car in India in the next two years as it looks to capitalize on growth in emerging markets to offset any sluggishness in US sales, a senior company official said. The model will not compete directly with Tata Motors' low-cost Nano but will be cheaper than GM's current lowest priced car in India, David Reilly, GM group vice-president, told a news conference on Monday.

Small cars make up nearly three-quarters of India's market. GM offers the Chevrolet Spark in the sector for about £3600. "We need some thing lower than what we have got now. I think if we could find a vehicle less than that, it would not only benefit India but could benefit other places also," Reilly said, without detailing how much the new model would cost.

"But I would not call it an equivalent of Nano." Tata Motors unveiled the £1300 Nano, the world's cheapest car, in January and said the new four-seater would roll out later in the year from its West Bengal factory. Reilly said sales growth in emerging markets would outpace any softening in established markets like the United States and would help maintain the firm's total global sales expansion.

"I don't predict a slowdown, but this year US would be tough," he said. GM, which has a 3 per cent share of the Indian vehicle market, has a manufacturing plant in the western state of Gujarat and is building a second facility near Pune in neighboring Maharashtra state. Reilly said the first trial car from the Pune plant, which will begin commercial production in the last quarter of 2008 with an initial production capacity of 140,000 vehicles, would be rolled out on Wednesday.

The company also plans to build an engine plant in India, but Reilly would not share details. "We are still in some negotiations ... We absolutely intend to go ahead with it," he said, adding that the company would be give further information within the next two months.

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Top Gear BL special cars spotted:
time for a rescue plan?

KEITH ADAMS

Rover SD1 and Princess exposed to the elements at Dunsfold Aerodrome, the home of TG...
(Picture: Pistonheads.com)

A BRACE of BL's finest are languishing at the Dunsfold Aerodrome, awaiting an unknown fate following their brief starring status in the hit TV show, Top Gear. The cars, which acquitted themselves well after undergoing punishing tests, which included being filled with water and driven over MIRA's pavé at 30mph, have been lying dormant as the disposal of BBC property is far from a straightforward procedure.

The cars were spotted by matt21, a member of the popular car enthusiast website, Pistonheads, when visiting Dunsfold - the home of the TG test track and aircraft hangar - recently. As can be seen, they are pretty much as they were when the show stopped filming, and look set to remain there for some time to come. However, because of public liability and the Beeb's policy on selling its wares, the future of thesee cars looks uncertain at the moment. As for the Dolomite Sprint - there was no sign of this...

The show's cars are stored at a corner of Dunsfold, and more can be seen on the Pistonheads forum thread, and there's surely enough material there to open up a Top Gear museum; something that many of the show's many fans would dearly love to see.

However, the BBC is unlikely to go down this route - so perhaps it's time to lobby the show's producer, Andy Wilman, and try and find new homes for these cars, by letting them go to enthusiasts - surely with a disclaimer signed, and a charitable donation made, these cars could be passed on to non-profit organizations, such as the Rover SD1 Club or the Princess and Ambassador Owners Club? These cars need rescuing now, before it's too late...

If you feel strongly, drop us a line, and we'll pass on your comments to Andy Wilman.

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Dr. Gao: MG goes global

CLIVE GOLDTHORP

Dr. Gao Weimin receiving the Chinese Inward Investor of the Year award from Lord Digby Jones at the
KPMG China Business Awards 2008 Dinner in London last month.

AROnline has just obtained an English language translation of a recent and revealing interview given by Dr. Gao Weimin, the Manager of SAIC Motor Corporation Limited’s (SAIC Motor’s) Technical Centres (and Chairman of SAIC Motor UK Technical Centre Limited), to a reporter from the Beijing Youth Daily.

Dr. Gao, who had a six-year stint as Deputy Manager of Pan Asia Automotive Technical Center Limited (a 50-50 JV between GM and SAIC Motor) before starting his present job, now has responsibility for managing SAIC Motor’s four Technical Centres at Nanjing and Shanghai in China, Leamington Spa in England and Pyungtaek in South Korea in addition to overseeing the implementation of a three year Future Product Programme based on six platforms, ten different engines and three separate transmissions.

SAIC Motor’s original intention was to develop a total of five platforms, for the following models, by 2010:

- a B segment supermini,
- a C segment, Roewe 550-based, series,
- a D segment, Roewe 750 derivative series,
- an E segment large car series and
- an SUV series.

However, Dr. Gao stated that, since the acquisition of MG, a sixth platform had been added to the Future Product Programme: ‘The sixth platform is a sportscar platform. The Roewe brand had no space for a sportscar, so the sportscar platform will go to MG.’

Dr. Gao also revealed that a total of ten new engines are to be rolled out over a five year period and that these will include all new families of 1.3- and 1.6-litre four cylinder, 2-litre and 2.4-litre four cylinder and 3-litre and 3.6-litre V6 cylinder petrol engines. Dr. Gao added that SAIC Motor are working on alternative powertrains using CNG and hybrid systems and that the company also has access to a range of diesel engines by virtue of a controlling stake in South Korea’s SsangYong Motor Company.

SAIC Motor’s Technical Centres are also developing three new transmissions. Dr. Gao said that: ‘We’re designing gearboxes according to the size of the engines. We’re working on a six speed manual with a range from 200nm to 400nm. Automatic gearboxes are also being developed.’ The Beijing Youth Daily article claims that the range of engines and gearboxes are expected to be put into production by early next year.

Dr. Gao also told the Beijing Youth Daily’s interviewer about the future division of responsibility between SAIC Motor’s Technical Centres. The Technical Centre in Shanghai’s main focus will be on the development of the Roewe brand and the design of flagship models. However, following the integration of the Nanjing-based Technical Team, the Shanghai Technical Centre will also assume responsibility for the MG platforms. SsangYong’s Technical Centre will concentrate on designing cars to meet the specific needs of the South Korean market while the European Technical Team, based at SAIC Motor UK Technical Centre Limited’s premises at Leamington Spa in England, will be working primarily on cutting-edge technologies and their initial application to SAIC Motor’s new products.

The Beijing Youth Daily’s reporter also discussed the ‘brand positioning struggle between the MG and the Roewe brands’ with Dr. Gao who indicated that NAC MG and SAIC Motor had completed a joint appraisal of the respective brands’ attributes and had now clearly mapped out their positioning. Dr. Gao specifically confirmed that MG will be a sports brand and that the MG range will be targeted at consumers who appreciate a sportscar.

Dr. Gao added that: ‘Introducing a brand that no one has any connection to would not be a great idea – to persuade people to buy a car from a new brand would need a lot of time and, more importantly, a lot of money. Now with MG, we can take that brand global. No matter whether the cars are made overseas, or merely sold overseas, we will sell them under the MG brand.’ He also confirmed that SAIC Motor UK Technical Centre Limited will be responsible for the design and development of all the MG models based on the six platforms mentioned above and intended for sale in Britain and Europe.

AROnline’s own, independent, research indicates that the Beijing Youth Daily’s article accurately represents SAIC Motor’s overall strategy for the MG brand. However, certain elements of the projected timetable might yet prove to be a tad optimistic because the specific details of the MG Brand Development Strategy and Future Product Programme have still to be finalised.

Interestingly, SAIC Motor UK Technical Centre Limited was awarded the Chinese Inward Investor of the Year Award at last month’s KPMG China Business Awards 2008 Dinner in London. Dr. Gao, the company’s Chairman, was presented with the award by Lord Digby Jones of Birmingham, Minister of State for Trade. (See photo above)

AROnline reckons that the award provides some tangible evidence of SAIC Motor’s commitment to Britain as a base for the European relaunch of MG and that Dr. Gao’s remarks suggest that a degree of cautious optimism about the future of the famous marque might be justified.

[Editor’s Note: AROnline wishes to thank Ash Sutcliffe of China Car Times for his translation of the original Beijing Youth Daily article.]

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K-Series owners welcome the five-year headgasket

KEITH ADAMS

A little bit of peace of mind for K-Series owners...

EASTBOURNE MG Rover specialists, Sterling Automotive, are offering a five-year K-series service for those looking for piece of mind in the future. The new package, which employs all of the elements retrospectively developed to undo many of the design faults inherent with the engine, is said to be the best survival package available for four-cylinder K-series powered cars.

The company, which boasts 100 years of MG Rover experience in its current team, fits the modified multi-layer steel headgasket, stretch bolts and more substantial lower engine oil rail which were first used in the Land Rover Freelander. Patrick Warner, the managing director of the company, said, 'We believe that this repair provides substantially improved resistance to any future gasket failure and where a coolant level sensor is also fitted, early warning can ensure that the driver attends to any minor coolant leaks before it leads to overheating and a more expensive repair bill.'

He added, 'This is why we have developed this special five year deal, whether your car has just suffered a head gasket failure or you just want to take advantage of this offer for future peace of mind.'

To take advantage of the offer, the health of your car's cooling system will be fully checked out, and if there are any weaknesses, they will be pointed out for repair. A clean bill of health leads to the uprated parts being fitted, and the five-year guarantee being applied. A nice touch is the addition of an upgraded expansion tank with coolant level sensor, audible warning buzzer and light, alerting you to any drops in coolant level before it is too late.

For more information, log on to Sterling Automotive's website, or email Patrick Warner.

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Ratan Tata: talking in Geneva

CLIVE GOLDTHORP

AROnline’s latest News Digest includes an article from the Birmingham Post in which Duncan Tift reports that an announcement about Tata Motors Limited’s acquisition of Jaguar and Land Rover will now be made during the week before Easter and quotes one source as saying: ‘There will be nothing now before March 17 by which time they hope to have the larger issues sorted.’

Tata Motors Limited is, in the meantime, exhibiting the Tata Nano at the Geneva Motor Show and the company’s Chairman, Ratan Tata, was in attendance. Mr. Tata explained that the company had brought the Nano to Geneva because ‘emotionally this is the place where we launched our first car’ and added that ‘Eleven years ago, we came to Geneva as a new car company from the developing world that was trying to find its place in the global car industry. We launched the Indica, which we designed in India, and received such encouragement and support from the international media that it spurred us on to be a car company of consequence.’

The new Tata Indica V3 was also on display in Geneva and Ratan Tata said he ‘hoped this car will be available in Europe in the future.’ Indeed, according to one report, Mr. Tata appears to have confirmed that, under the terms of the Land Rover sale, all ‘…..Rover’ brands will pass to Tata Motors Limited. AROnline’s predictions about a re-engineered, re-skinned/styled, 'Roverised' Indica V3 being launched as a successor to the Rover 25 may yet, therefore, prove to be accurate.

Interestingly, although Autocar.co.uk recently ran an article speculating about just that prospect, the magazine’s interviewer omitted to question Ratan Tata about a Rover revival during the exclusive interview, published on the 5th March.

However, Autocar’s interviewer did ask Tata Motors Limited’s Chairman whether or not he believed that Jaguar should build a new sportscar. Mr. Tata replied: ‘I really can’t express a view because we don’t own the company. But if the day comes when we do own it, I shall have pleasure in answering you, because I do have strong views on the subject. I look forward to answering your question...’

AROnline infers from that response that, once the deal has been sealed, Jaguar’s proposal for a two-seater F-TYPE Roadster (or XE?) will, almost certainly, be approved for production. That must be good news for all fans of the marque. Hopefully, Ratan Tata will have some equally good news for Rover enthusiasts in the not too distant future as well…

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News digest Geneva special

Compiled by CLIVE GOLDTHORP

1) TATA and Jaguar/Land Rover

Big Cat and Land Rover leap into Geneva spotlight
Duncan Tift, Business Staff, Birmingham Post 4th March, 2008

While the eyes of the automotive world focus on new small, less polluting and more fuel efficient cars, it is the fate of two brands at the opposite end of the spectrum which is likely to occupy the thoughts of many Midlanders at this week's Geneva Motor Show. The exhibition is likely to be the last major event where Jaguar Land Rover are displayed under the ownership of Ford.

An announcement confirming that the two marques are to become the property of Indian conglomerate Tata is thought to be imminent. The protracted sale, initiated by a cash-strapped Ford, could generate around £1 billion for the Blue Oval, still a long way short of what it needs to fill the black hole in its finances but which will nevertheless ease worries.

Unions at Jaguar Land Rover have been seeking assurances from the Indian suitor that it will protect jobs by investing in a long-term UK production plan. They have also been keen to protect the integrity of the JLR supply chain to guarantee the jobs of thousands of workers in the vital components industry. The requirements appear to have been met and providing there are no last minute obstacles then an agreement could be made very shortly.

On a practical level, while small cars continue to dominate the agenda, Land Rover will be hoping for great things from its own mini-SUV, the LRX, which has its European debut at the show. Jaguar will also be seeking further praise for its already award-winning XF, which is receiving rave reviews wherever it goes. For current parent Ford, the show is very important. Away from its luxury models, its mass market credentials are expected to be underlined with the unveiling of a redesigned Ford Fiesta.

Kuga (above) and Fiesta (below) underline Ford's mass-market credentials...

Designed and developed in Europe for sale in Europe, Asia, South Africa, Australia and the Americas between 2008 and 2010, the new Fiesta is the first major product of Ford's new global product development process. The new Ford Kuga crossover is the latest addition to the C-car line-up and is appearing alongside the entire new Focus range, including, for the first time, the restyled coupe-cabriolet which will also have its public debut.

Tata is also using the event to showcase its own new products - the ultra-cheap Nano and the revamped Indica, both of which were unveiled in Delhi in January but which get their European debut in Switzerland. The Indica could go on sale in the UK later this year or early 2009, although this has yet to be finalised. Elsewhere, a redesigned Volkswagen Scirocco, the sport compact model that was a bestseller from its launch in 1974 until 1992, could be one of the stars of the show, as could the Nissan Motor Co GT-R sportscar, which pulled the crowds at the Tokyo Motor Show in October.

Fiat will revive its Abarth badge for a high-powered version of the Fiat 500 city car, while it will also be reintroducing another old classic, the Lancia Delta. Renault rolls out a new Clio and Twingo Sports version. Nissan will take the Infiniti luxury brand to Europe with the world debut of the FX model while at the other extreme, Toyota will unveil the world premiere of a prototype small car, iQ, set for production in 2008. These cars now make up 36.5 per cent of the western European market, up from 34 per cent in 2005, and the portion is set to increase in part because carmakers can reduce their overall CO2 emissions - and EU penalties - by selling more smaller cars in their product mix.

For those unconcerned by emissions levels, Rolls-Royce will be launching its new V12 Phantom Coupe, while parent BMW will also be unveiling an M3 cabriolet and the X6 off-road coupe. Citroen has a new Berlingo and the C5 Break, while Peugeot has the sportswagen version of the 308 to show off. Saab will be displaying its green credentials with a compact, ethanol-powered 9-1X. The new Honda Accord will be shown, both in saloon and estate version, while the manufacturer will also be showing off its CR-Z hybrid concept car and the FCX Clarity hydrogen fuel cell car. Mercedes has new generations of its SL roadster and CLS four door-coupe, plus the SLK 350 small roadster and former sports coupe, the CLC.

Tata pledge on character of Jaguar and Land Rover
Lionel Barber and John Reed in Geneva, Financial Times 5th March, 2008

TATA, whose automotive division is negotiating to buy Jaguar and Land Rover from Ford Motor, has no plans to "Indianise" the UK carmakers, its chairman said yesterday. In an interview, Ratan Tata gave some of his clearest indications yet that his group will retain the brands' British character and leave their management largely intact after buying them from Ford later this year.

"We expect management to integrate with ours," Mr Tata told the Financial Times. "We expect the integration to be easy, and [we] would not get involved with Indianising the company." Mr Tata, who was in Geneva yesterday for the European debut of Tata's low-cost car, the Nano, would not comment on the specifics of talks with Ford or Tata's plans for Jaguar and Land Rover, saying this would be "inappropriate".

However, he referred to Tata's "philosophy" in dealing with past acquisitions it had made, including of Britain's Corus and Tetley Tea, and Daewoo's former heavy trucks division in South Korea. At Tetley, he said, Tata had left existing management largely in place, as it had done at the steelmaker Corus. Tata had also managed labour problems at Daewoo "faster than General Motors did" when it bought the Korean group's carmaking division.

"We are not looking for a company in which we make a drastic change," Mr Tata said. "The chances are that we would leave the management more on its own to be more responsible for budgets and oversight than micromanaging the day-to-day business of the company," he added.

The Indian group was also prepared to "add value in the supply chain, but where we can really add value is in co-operating on engineering and development, which are considerably cheaper than in the west", Mr Tata said. Tata might also help build the brands' business in Asia. "I think we understand Asia better, so we can add value there," he pointed out. Tata's pledge to leave intact much of the management of the two brands - which share accounts and some other functions - was crucial in obtaining the endorsement of Jaguar and Land Rover's trade unions.

Ford foresees "no major roadblocks" to the deal, but "there are still some things we need to discuss", the US carmaker said yesterday. Ford said it still expected the deal to be completed "in early 2008". The purchase will fetch about £1bn for Ford and mark the highest-profile takeover yet of an established European carmaker by an emerging Asian manufacturer. Tata, Ford and their advisers are working through the details of numerous agreements, including deals on future engine supply, intellectual property, and Jaguar and Land Rover's pension fund.

Tata seeks $3bn to buy Land Rover and Jaguar
Joe Leahy in Mumbai, Financial Times 6th March, 2008

TATA Motors is seeking loans of about £1.5bn to fund its planned purchase of Ford Motor's Jaguar and Land Rover marques as the company moves closer to sealing the takeover, people familiar with the matter said yesterday. India's second-largest carmaker has assigned Citigroup and JPMorgan, its financial advisers on the acquisition, to arrange the financing with a range of other international and domestic banks taking part in the talks.

The loan, which is expected to be mostly short-term bridge financing, is bigger than the anticipated purchase price of the deal, estimated at about £1bn. A person familiar with the deal said part of the loan could be used for working capital for Tata Motors "but the jury is out" on the details. Tata's efforts to begin raising financing for the deal comes amid expectations that the transaction will be closed in the coming weeks once negotiators work through agreements covering engine supply, intellectual property and Jaguar and Land Rover's pension funds.

Tata is entering the market at a difficult time for acquisition financing with companies facing higher prices in raising high-yield bonds for takeovers, and banks keen to spread their exposure to such debt. Alongside Citigroup and JPMorgan, other banks interested in shouldering part of the loan include Standard Chartered, State Bank of India, Bank of Tokyo and Mitsubishi UFJ, Mizuho Financial Group and Calyon, people familiar with the situation said.

They said details, such as how the refinancing of the bridge loan into longer-term instruments would be organised, were still being ironed out. Standard & Poor's, the ratings agency, in January placed Tata's BB+ rating, which is one notch below investment grade, on "creditwatch with negative implications". The move followed an announcement by Tata that it was the frontrunner in the battle for the Ford marques. S&P said the deal would be "a large-scale acquisition for Tata Motors" that could potentially lower its credit rating profile.

Tata yesterday declined to comment on the fundraising plan. But people familiar with the deal said they expected the debt to be priced at about 2 percentage points above the London Interbank Offered Rate. News of the plan comes as Ratan Tata, chairman of the Tata group, said this week that he planned to leave management of the two marques largely intact and to retain the brands' British character.

Sale of Land Rover and Jaguar delayed
Duncan Tift, Birmingham Post 6th March, 2008

The acquisition of Jaguar and Land Rover from Ford by Indian conglomerate Tata has been postponed while the two sides agree the final terms of the billion-pound deal. It had been widely expected that an announcement would be made at the Geneva show after unions finally received the assurances they wanted on the fate of the companies once the sale went through.

However, sources close to the deal told The Birmingham Post that it was now likely an announcement would be made sometime during the week before Easter. "There will be nothing now before March 17 by which time they hope to have the larger issues sorted," said one source. They dismissed fears that the deal had run into problems or that Tata wanted to dispose of Jaguar.

And suggestions that Tata was looking to develop a Land Rover manufacturing facility in India were also given short shrift. The final formalities are expected to be agreed in the next fortnight, leading to a formal handover and registration at Companies House sometime around the end of the month. The timetable was confirmed by a spokesman for Unite, who said: "We have been told that a memorandum of sales will now take place in the week beginning March 17, after the Geneva Motor Show is over."

Speaking at the Geneva show, Ford vice president Lewis Booth said there were "no major roadblocks" to overcome and that the deal should be completed by the end of the second quarter. Meanwhile, Tata chairman Ratan Tata moved to quell fears over what was likely to happen to the companies post-Ford by saying that he had no plans to 'Indianise' the famous brands. He said the intention was to retain their British character and leave the management intact. The arms length approach is similar to what Tata has done with former British Steel, Corus, which it acquired in 2006.

Echoing comments he made at the Auto Expo event in Delhi in January, he referred to the company's philosophy on handling acquisitions, which was to keep the bolt-ons largely untouched. He said the chances were that the management of the companies would be left to run the firms as they saw fit, with responsibility for budgets and oversight being retained. The approach has been questioned in some quarters with analysts saying change was vital, but Mr Tata defended the approach and previously said they had not "flipped" companies they had been involved in.

Sources close to Mr Tata yesterday said this would hopefully end rumours that the company intended to ditch loss-making Jaguar the moment the deal was complete. There were fears that the Indian company was interested solely in Land Rover and its inexperience with luxury brands would prompt it to dispose of Jaguar, creating the unseemly prospect of the famous marque being hawked around the automotive world much as MG Rover was following the demise of Longbridge. "This is complete nonsense," said the source.

Several websites were claiming yesterday that the company had acquired 450 acres of land at Gurgaon, outside Delhi, for a new factory. "This is a load of rubbish - there are no such plans," said the source. However, the suggestion is bound to raise concerns among manufacturers in the Jaguar Land Rover supply chain, who are already having their nerves tested to the limit by the protracted negotiations. One West Midlands business organisation said nerves would only be calmed once the deal was finalised and contracts with the new owners were assured.

Jaguar 'will stay in Coventry'
Chris Russon, Coventry Telegraph 5th March, 2008

JAGUAR'S new owners will keep the company firmly in Coventry. That is the clear indication from the head of Indian conglomerate Tata who are finalising their bid to take over the luxury car firm. The news, which will delight thousands of Jag workers in Coventry, has come in an exclusive interview by tycoon Ratan Tata with the Coventry Telegraph.

Mr Tata, who is working hard to complete a £1bn takeover of Jaguar and Land Rover, said he had great respect for the expertise of the Jaguar workforce. He described both Jaguar and Land Rover as iconic brands and pledged they would remain British. Mr Tata even quipped that he soon wanted to own a Jaguar and a Land Rover model himself. The businessman was talking exclusively for the first time about the deal. He said his team from Tata Motors was in the process of completing due diligence with Ford, which owns Jaguar and Land Rover.

"We are very conscious that these brands belong to Britain," said Mr Tata, chairman of India's largest industrial corporation. "I have to say we respect these brands, and if this is all concluded our intention is to nurture them and support their needs." He went on to say that Tata was not interested in outsourcing production to India or "stealing" technology.

"Our interest in Jaguar and Land Rover was not based on outsourcing, and was not based on taking technology. "It was very much an interest in the brands that were there and cultures behind them." Tata, which already owns British steel company Corus and tea maker Tetley, has built a reputation of leaving managements alone to carry on with their businesses.

"We want to be an international car company. We need a window to new technology and new capability," he said.

Describing the moment Tata became interested in acquiring the two car companies from Ford, Mr Tata said: "What attracted us was that we were looking at two iconic brands we respect enormously. This was not a hostile bid and we are very pleased to have been considered in this invitation." He went on: "Our plans are to retain the image, the touch and feel and not to tinker with the brands in any way - whoever gets them has a global responsibility to nurture them and move them forward."

2) SAIC Motor/MG and Roewe

SAIC in talks with Karmann for Roewe 550 production in Europe
China Car Times 3rd March, 2008

SAIC are actively seeking partners to build the Roewe 550 for European distribution according to the Chinese automotive portal, auto.sohu.com. SAIC have reportedly held talks with the German company, Karmann, in hopes of getting them on board to make the Roewe 550 for the European mainland.

SAIC are saying that since buying NAC MG and inheriting the British factory, Longbridge, their strategic sales plans have gathered speed, and have said their next target for expansion is Europe. Once launched in Europe, the Roewe 550 is expected to sell for 12,000 to 20,000 Euros.

Roewe 550 photo extravaganza!
China Car Times 5th March, 2008

Someone found the latest Roewe 550 parked right outside of their house, and what did they do? They took a million photos of course, and then posted them on the Internet.

3) British LVSM News.

Aston Martin to start production in Austria
Birmingham Post 4th March, 2008

Warwickshire-based supercar maker Aston Martin is to build one of its models outside Britain for the first time in a deal with an Austrian firm. The four-door Rapide model will be built at Graz in Austria late next year, with production expected to reach more than 2,000 a year in partnership with Magna Steyr. Aston Martin said demand for the cars it builds at Gaydon in Warwickshire - the DB9, the V8 Vantage and the recently-launched DBS - was fast approaching full capacity of 8000.

Chief executive officer Ulrich Bez said: "I am confident that the partnership with Magna Steyr is a sound business proposition to ensure continued future stability and growth for Aston Martin. "The dedicated Aston Martin Rapide plant will have the ability to deliver the highest levels of quality similar to those which currently exist at our Gaydon production facility."

Production of Rapide is expected to begin in late 2009 with around 2000+ cars being built annually.

Sleek new eco-friendly Morgan emits only water
Duncan Tift, Birmingham Post 4th March, 2008

LifeCar generated lots of interest at Geneva...

A new emission-free concept car is to be launched by Worcestershire-based Morgan Motor Company. The Morgan LifeCar, which is powered by a hydrogen fuel cell, was unveiled at Geneva. The aim of the concept car is to "demonstrate that a zero-emission vehicle can also be fun to drive", according to the company's website.

"The combination of performance, range and fuel economy will allow a sporting driver of the future to demonstrate a concern for the environment," the website said. The initial concept was the brainchild of Hugo Spowers of RiverSimple, a London-based company specialising in environmental transport. However, a number of firms have joined with Morgan, based in Malvern Link, to fine tune the plans.

Hydrogen is used as the fuel source because when it burns, the only emission is water, a company spokesman said. The car has been designed to have a top speed potential of 80-85mph, a 0-62 time of under seven seconds and a 250-mile range. The spokesman said: "Using only the best and lightest materials that are also attractive from an environmental and an aesthetic point of view - aluminium, wood and leather - the Morgan DNA is clearly visible and gives a new dimension to an environmentally sensitive concept."

The importance of greener vehicles is one of the main themes of this year's Geneva show and joining Morgan in exhibiting cars with hydrogen fuel systems are several other manufacturers.

4) China Watch

PwC Automotive Institute forecasts tough fight for Chinese cars in Europe
Auto Industry 4th March, 2008

There has been much speculation as to how the arrival of low cost Chinese cars will impact the EU market – yet estimated sales amounted to less than 2,000 units in 2007, a figure well below automakers’ ambitious projections. Michael Gartside, a PwC Automotive Institute analyst considers how real the threat to competitors posed by Chinese brands within the EU market is, in the light of China’s eleventh and most recent five year plan which encourages the development of light vehicle exports.

To date, says Gartside’s PwC Automotive Institute Analyst Note of 3rd March, the majority of sales initiatives in the EU have come from local entrepreneurs who have seen an opportunity, though negligible sales in 2007 call that opportunity into question. He notes that a host of internal and external factors have aided Asian brand growth in the EU over the past three decades, most notably the demise of British Leyland/MG Rover and weaknesses among Fiat, Ford and GM at the start of this decade.

These factors, combined with the launch of competitive diesel engines, crucial in a diesel-centric market, along with products in strong growth segments such as midsize SUVs, accelerated market share growth. Additionally, arguably higher levels of quality and equipment for a lower price, heavy investment in localising design, product development, and assembly in Europe also contributed. None of these elements apply to the Chinese products at present – if anything, generally the opposite is the perception. Chinese manufacturers have launched substandard and inappropriate products in a market currently characterised by strengthening local players and increasing competition.

In a market intensely focused on safety and the environment, poor crash test ratings and high CO2 emissions will represent just two of the many hurdles on the path to market prominence. Brand image and recognition are also likely obstacles that may prove difficult to overcome in the near-term. Presently, the value oriented status of the current wave of Chinese products represents their core unique selling proposition. However, cost-of-ownership analysis suggests Chinese products can be more expensive than competitors. Additionally, the nearly new car market will further undermine their value proposition in the overall vehicle market.

However, Gartside says Chinese OEMs will undoubtedly close the competitive gap in the future as they mature and begin to utilise established global suppliers. However, although Chinese sales will likely increase, significant gains may be harder fought than in the past.

5) India Watch

Tata wants 4-star safety for Nano
Tony Lewin , Automotive News Europe 5th March, 2008

Tata Motors will only sell its Nano microcar in Europe if it achieves a high safety rating. "We will only bring the Nano to Europe if it achieves a four-star rating in the Euro NCAP crash test," said Girish Wagh, director of the Nano program. The Nano already has a full protective frame to meet local Indian safety standards, Wagh said. European versions would include airbags and other protective systems and Tata will soon be testing the vehicle to Euro NCAP standards, he said.

Tata is focusing on the Indian market for the Nano but plans to sell the car in Europe in the longer term. "We will add the European market in the course of time," Tata Motors Chairman Ratan Tata told Automotive News Europe. He did not say when the Nano might be sold in Europe. Tata said the Nano could be sold in all European markets. "We are not restricting ourselves to eastern Europe. We will definitely look at Western Europe. We already have distributors in Italy and Spain," he said.

Tata will focus on markets such as Asia and Africa before Europe for the Nano, Tata said. He said the company is not looking at China as a potential market.

Tata's Nano: High-end version to hit Europe
Nandini Sen Gupta, TNN, Times of India 5th March, 2008

Just minutes after the unveiling of the Nano at the Geneva Motor Show, Prodrive boss and now CEO of Aston Martin David Richards pumped Tata Motors MD Ravi Kant’s hand warmly saying, "there are so many beautiful cars around but you guys have stolen the show." A visibly thrilled Kant replied, "Coming from you that’s a huge compliment."

The exchange continued, with some friendly asides about Jaguar Land Rover — "I understand we are soon to be neighbours," Mr Richards said so which Mr Kant replied, "We are trying very hard" — till the Tata official was pulled away by local media. David Richards wasn’t the only global auto CEO to sit up and take notice of the Nano. Minutes before the unveiling, Fiat boss Luca de Montezemolo dropped into the Tata pavillion for some congratulatory words and a warm hug for Mr Tata. Of course, not all reactions were quite that cheer-leading.

Earlier in the morning, Honda Motor Company CEO Takeo Fukui answered questions on the Nano effect saying: "The Nano I don’t understand. The Jazz is the smallest car for Honda but we need smaller and cheaper vehicles for India in future. Of course ecology is important and safety is important too." Honda is already working on another small car to complement the Jazz in India in an effort to shore up its compact presence. For the man of the moment though these bytes are just that...bytes. And he takes them with equanimity just like he did when the top names in the business dismissed the Nano project as a can’t be done. "It’s interesting that the auto majors are talking about better fuel efficiency," he said.

"A lot of these people said such a car could not be made in the first place." The Nano’s Euro debut and the interest it has generated both in the industry and media will of course come in handy when the car actually goes to Europe. At the unveiling, Mr Tata said that the top-end variant on display could find its way to Europe one day, though there’s nothing planned for now. "The Nano will address global markets in due course but when it will do so has not been decided."

And when it does, the Euro Nano will be a different animal even though design wise it would remain the same. "We will upgrade the car when we do decide to sell it in Europe or elsewhere — not the design but it will meet all the regulatory and legislative requirements," Mr Tata said. "The car for Europe and other developed markets will be an evolution of the current model. But that will happen only after we establish the product in India." Mr Tata also indicated that if his capacity did not catch up with the demand for the Nano at home and abroad, he would be open to licensing arrangements with other auto companies. "If there’s demand we can’t meet, we will look at licensed production agreements but if we can meet that demand ourselves we will do so," Mr Tata said.

Apart from Europe, the Nano could also find a big market in Latin America. As for whether Fiat will be involved in marketing the car in Latin America where the Italian company has a large footprint, he said: "Everybody will wait for the car to come out first and then look at the business case." Meanwhile, Tata Motors will use its satellite manufacturing concept to ramp up its distribution footprint for the Nano. "We intend to have satellite manufacturing units that would be low cost and these would be sold of entrepreneurs to them franchise manufacturers of the Nano," Mr Tata said. "This structure will not be in lieu of but in addition to our existing distribution system," he added.

The Nano’s Euro outing though will not position it very differently from what it is elsewhere. "We’ve made a commitment to develop products that can extend to markets beyond India and Nano too is part of that," Mr Tata said. "In Europe too the Nano will be a compliant vehicle at a never-made-available-before price point." However the recent 4 per cent cut in excise duty will not make the Nano sub-Rs 1 lakh. "We said we will give an Rs 1 lakh car and we will give an Rs 1 lakh car," Mr Tata said.

"To expect the Nano price to go down even further would be unfair. We didn’t raise prices when steel prices went up. Steel prices have started to firm up again and will pinch us further this year." The excise cut, he said, will "perhaps" help hold the Nano price to Rs 1 lakh. Indeed the excise lolly was the only silver lining in an industry that’s readying for some really tough times, he said. That included lack of capital, high interest rates and creeping prices of inputs. "I was watching the news on the US auto market and it was so depressing I could barely drink my coffee," Mr Tata said. Any relief, whether on input costs or excise, will be a "contribution for a project whose costs have been pared down to the bone," he said.

For Tata though the headline hour was not just for the Nano. On the Jaguar-Land Rover deal, Mr Tata said: "These are two iconic brands. It wasn’t a hostile bid but an invitation to pursue and we are fortunate to be in this line of discussion with them. The plan would be to retain the image of these brand sand not hamper them anyway. If the deal is complete our ambition is to nurture and grow these brands through our support."

That’s right up Ford’s alley given that the American company trying to work out a repeat of its Aston Martin experience with JLR. Aston Martin’s engines were and continue to be made by Ford in a separate unit of its Cologne factory. In JLR’s case, the engine supply agreement was reportedly the most important point in the negotiations. According to Ford sources, the reason why the deal has not been sewn up yet is because "the idea is to make sure everyone understands their obligations".

Ford does not want to end its relationship with JLR once it is sold to Tata Motors. "It wants to retain long term relationship and make sure it is mutually beneficial for JLR, Ford and Tata Motors," said the source. Clearly there’s more to David Richards’ banter with Bombay House brass than the Nano.

6) The Demise Of MG Rover Group Limited.

MG Rover inquiry taking too long, say MPs
Birmingham Post 5th March, 2008

MPs are demanding to know why there is still no end in sight to a long-running, £11 million inquiry into the collapse of MG Rover. The Commons Business, Enterprise and Regulatory Reform Committee is considering launching a probe into why accountants BDO Stoy Hayward are taking so long.

There are also concerns about the cost, which recently passed £11.1m, including about £125,000 spent by inspectors on hotels, food and drink. Committee chairman Peter Luff has now written to Business Secretary John Hutton urging him to set out a timeframe for the inquiry’s completion. The Conservative Mid-Worcestershire MP said: "The Government is declining to comment on why it’s taking so long and it’s not good enough.

"We think it’s time that everyone involved realises there is a degree of urgency here. People paid a heavy price for what happened to MG Rover and it won’t do for this just to go on and on." The independent inquiry was set up in June 2005 after the Longbridge plant, in the West Midlands, closed with the loss of 6000 jobs. Frustrations have grown as ministers have repeatedly declined to say when the inquiry might be completed. It was set up under the Companies Act nearly three years ago by then trade and industry secretary Alan Johnson.

Mr Johnson said at the time an investigation covering the two years leading up to the collapse was in the public interest. He added: "I have asked (the inspectors) to report to me as quickly as possible." In his letter, Mr Luff said: "While the committee does not wish to prejudice the inquiry in any way, we are becoming increasingly concerned about the lack of clarity about when the inquiry is expected to end, and about the reports of the high costs involved." The committee has requested a "broad indication" of the likely timeframe and a new estimate of the costs.

Mr Luff added: "Although we are concerned about the length of time this inquiry is taking, we also have concerns about whether this is an isolated problem, or indicates broader problem with the Companies Act itself. "To help us judge this, the committee would also like information about the average time spent on a Companies Act inquiry, and the range of costs incurred by such inquiries."

A Department for Business spokesman said: "It is crucial that the independent investigators are able to conduct an accurate, thorough and fair inspection that provides full answers to what happened when MG Rover collapsed in 2005. "To place an arbitrary deadline on the report could put this at risk. We meet regularly with the inspectors to ensure the momentum of the investigation is maintained and that the costs are contained as far as possible.

"We are confident that the inspectors are intent on completing the investigation as quickly as possible."

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Geneva Auto Show preview

KEITH ADAMS

For us, the Hybrid powered Morgan LifeCar will be the star of Geneva...

IT'S the first major European motor show of 2008, and you can be sure that the world's car manufacturers will being pulling out all the stops to impress car buyers and the media... and no doubt will be pushing the green angle for all it's worth. The major news will - hopefully – be the signing of the historic agreement between Ford and TATA Motors for the sale of Jaguar/Land Rover.

In terms of product announcements, there will be at least 60 to keep you amused and entertained - with a further version of the Land Rover LRX concept topping the bill for AROnline readers. However, it's hard to imagine that it won't be overshadowed by the arrival of important newcomers, such as the Ford Fiesta, Lancia Delta, Rolls-Royce Phantom Coupe, Skoda Superb, Volkswagen Scirocco and the weird and wacky Morgan LifeCar - proof, if ever it were needed that the British specialist industry is still very much open for business...

AROnline will be at Geneva with all the latest news, gossip and British car announcements - hopefully, as they happen. Keep checking back with AROnline to stay in touch with all the developments.

RDX60 finally makes production... oops, it's Lancia's new Delta - a Geneva debutante

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News digest

Compiled by CLIVE GOLDTHORP

1) TATA and Jaguar/Land Rover

Land Rover denies Indian assembly rumour
Autocar.co.uk 26th February, 2008

Rumours abound that the Defender will be produced in India in CKD form

LAND ROVER has moved to quell rumours that it is doing a deal to establish a kit assembly base in India, and in doing so setting up a distribution system within the sub-continent entirely unconnected with Tata Motors, the outfit that’s about to assume ownership of the company. A story in The Times of India quoting Land Rover global sales director John Stretton has caused a stir by suggesting that, after receiving a large order from the Indian military, LR is in the process of establishing an Indian hub for the assembly of between 1000 and 7000 Defenders from kit form.

Autocar put this to Land Rover. In response, it issued the following statement: 'Land Rover regularly attends defence equipment exhibitions in order to showcase vehicles with a view to generating orders. DEFEXPO in New Delhi (where this story originated) is one of the major shows in the industry and Land Rover was exhibiting a range of Defenders.'

'We supply vehicles to 100 armies around the world and are in global competition with other military vehicle manufacturers. We do not discuss potential contracts or partnerships. However, contrary to reports in certain Indian publications, Land Rover does not have plans to start manufacturing cars in India.' Land Rover already has kit assembly hubs like the one proposed in Turkey and Pakistan. A Land Rover spokesman told us, however, that no deal for the supply of Defenders to the Indian forces had been finalised.

Tata deal drives Land Rover's future
Christine Buckley, Industrial Editor, The Times 28th February, 2008

FORD is expected to seal the sale of Jaguar and Land Rover to Tata, the Indian conglomerate, next week after the American carmaker recently agreed to pump hundreds of millions of pounds into the pension fund to smooth the process. The deal is expected to be welcomed by unions, who believe that there is no immediate threat to British jobs or manufacturing.

The two sides, which have been in exclusive talks since the beginning of the year, are expected to sign a deal worth up to £1bn next Wednesday or shortly afterwards. Ford has pledged to pay £300 million into the pension fund to clear its deficit. It has also given assurances over the long-term supply of engines and some other components to the two marques to ease union fears about their future. Tata is also thought to have pledged that production will remain in the UK in the near term.

Ford uses engines for Jaguar and Land Rover from its engine factories in Bridgend, South Wales, and Dagenham, Essex.

It is Tata's second big investment in Britain, after its purchase of Corus, the Anglo-Dutch steelmaker, last year, and is its first big move into the Western car industry. At present Jaguar and Land Rover use some Corus steel. Tata makes lorries and cars in India and recently unveiled its Nano people's car, which retails at £1300. The sale marks the end of nearly 20 years' association with Jaguar for Ford, after it bought the iconic British brand in 1989 for £1.6bn, and eight years' ownership of Land Rover, which it bought in 2000 for £1.4bn when BMW split up the Rover group.

Ford has been pushed into a sale of some of its most respected brands by a need to stem spiralling losses after a tough market in the United States and, to a lesser extent, Europe. In 2006 it recorded its worst ever losses at £13.3bn. Last year, when it sold its flagship Aston Martin business, it pared back losses to £1.35bn. Alan Mulally, the chief executive who took over Ford 18 months ago, decided to sell the British brands to raise cash but also to allow Ford to concentrate on its core, blue-badged cars. Ford had grouped its luxury brands into a Premier Automotive Group division, which also included Volvo, a marque that it is retaining.

The recovery of Land Rover after heavy investment was always weighed down by losses at Jaguar, a brand that it failed to revive barring the success of some individual models. Ford tried to turn Jaguar into a volume producer and used the Ford Mondeo platform as a base for its X-TYPE Jaguar, which failed to sell in large numbers. Tata is believed to be committed to developing new Jaguar models, which are already in the pipeline.

Industry observers believe that there may need to be some rationalisation of Jaguar and Land Rover's facilities in the medium term because of the number of plants that the brands have. The most likely factory under threat could be Castle Bromwich, which makes the Jaguar range excluding the X-TYPE. Apart from Castle Bromwich's new XF, the other cars that it produces - the XJ and the XK - are made in relatively small numbers.

Tata was backed in its bid by British unions after they decided that it had the best long-term plan for the business. At the start, the sale of Jaguar and Land Rover attracted a large amount of private equity interest, but this fell off in stages until there were two main players - Tata and One Equity Partners, which was led by Jacques Nasser, the former Ford chief.

The two marques had to be sold together because Ford had merged a number of their operations and supplies. The official announcement is being timed for after the Geneva motor show, so that the two companies can try to promote their products at the key European showcase.

Jaguar and Land Rover: the nuts and bolts

Jaguar and Land Rover shared facilities
Halewood, Merseyside
— Assembly plant makes Jaguar X-TYPE and Land Rover Freelander
— Employees: 2100

Gaydon, Warwickshire
— Design and engineering, marketing, sales and service
— Employees: 2890

Jaguar facilities
Castle Bromwich
— Assembly plant for XF, XJ and XK
— Employees: 2200

Browns Lane
— Veneer manufacturing, heritage centre
— Employees: 490

Whitley
— Design, research and development
— Employees: 1980

Land Rover facilities
Solihull

— Assembly plant makes Range Rover, Land Rover Discovery and Defender
— Employees: 5730

Announcement of Jaguar Land Rover sale set for 4th or 5th March
Tony Lewin, Automotive News Europe 25th February, 2008

TATA Motors will announce its purchase of Jaguar Land Rover on 5th or 6th March. The dates have been agreed between Tata and Ford, which is selling the two luxury brands, following talks with trade union leaders last week.

Roger Maddison, national officer of Unite, the largest union in the UK auto industry, told Automotive News Europe Tata had agreed to meet guarantees sought by workers' leaders. He said, 'Everything seems fine as far as we are concerned; it's just the lawyers working on it now.'

Union leaders spoke with Ford and Tata to resolve final details before the drawing up of a memorandum of understanding for the sale. In earlier talks with the two companies, unions had been seeking assurances that Tata would continue to source engines, stampings and other systems from Ford's plants in Bridgend in Wales and Dagenham, near London.

All Jaguar and Land Rover engines come from Ford plants, as do many of Land Rover's stampings. While Ford would not comment officially on the planned announcement date, insiders confirmed to ANE that 5-6 March were 'not too far off track.' A Ford source ruled out any kind of announcement at next week's Geneva auto show, where the first press day is on Tuesday, 4th March.

At Geneva, Ford is launching a new version of its second-biggest seller, the Fiesta small car. The source said an announcement of a deal with Tata would be held back to avoid overshadowing the debut of this key new model. 'The sooner everything goes through, the better,' said Maddison. 'The workforces are beginning to get anxious.'

2) XPART

XPart seeks 60 applicants for specialist MINI repair franchise
Auto Industry 22nd February, 2008

You can now get your MINI serviced by XPart

XPART, the operator of the AutoService centre network formed after the demise of MG Rover, is offering its 240 franchisees and others a specialist servicing franchise for the MINI, to appeal to owners whose original warranties and optional ‘TLC’ aftersales contracts are expiring and who may wish to use an alternative to BMW/MINI franchise dealers for servicing and repairs. This is the first time that a national network of non-authorised single-marque service and repair specialists has been formed.

Joining the XPart AutoService centre network’s MINI module involves buying a £500 ‘stock pack’ of 54 service parts from XPart, including 18 service parts which can be sold with an 'excellent' margin for the repairers. Signage is another franchise requirement and costs between £200 and £720 depending on the type needed. AutoService centres will also need to invest £4500 plus VAT in read-and-erase diagnostic equipment, plus a product training course, from Autologic, which also supplies diagnostic equipment to MINI dealerships. An AutoService centre can become a MINI specialist for £6000. XPart aims to create a network of at least 60 MINI specialists nationwide.

Franchise holders will not be authorised repairers for the MINI brand under the terms of the EU block exemption.

XPart’s existing parts network receives overnight parts deliveries from Desford in Leicestershire, with same-day delivery from over 100 regional parts wholesalers. For more information on becoming an XPart MINI specialist, repairers are asked to visit www.xpart.com or call Don Lindsay on 01455 826 888.

XPart is a wholly owned subsidiary of Caterpillar Logistics Services UK Ltd.

3) China Watch

Brilliance, BYD will use Geneva as European launchpad
Douglas A. Bolduc, Automotive News Europe 25th February, 2008

Brilliance is going for a European re-launch...

BRILLIANCE Jinbei Automotive will show two new models for Europe at the Geneva auto show next week. The Chinese carmaker will unveil the production version of the BC3 coupe and the face-lifted BS6. The production version of the BS4 also will be on display.

European sales of the BS6 stopped last July and August after the large-segment sedan did badly in crash tests conducted by 11 national auto clubs, including Germany's ADAC. Brilliance has redesigned 65 BS6 parts to improve its safety. Spanish independent tester IDIADA crashed BS6 prototypes to EuroNCAP standards and says it would get a three-star rating.

Production of the BS6 and BS4 will start in April or May at Brilliance's factory in Shenyang, near China's border with North Korea. The BS4 will be a rival to the Skoda Octavia and the BC3 will compete with the Hyundai Coupe. The cars will start arriving at European dealers in the summer. China's BYD Auto will show its F1 minicar and F3R lower-medium hatchback in Geneva. The F3R went on sale in China last July. F1 sales will start in China within two months.

BYD also will display its large-segment F6, which debuts in China in two months, plus a gasoline-electric hybrid and plug-in electric car. BYD has two car assembly plants in China with a combined 300,000-unit annual capacity. BYD plans to start selling cars in Western Europe within 12 months. Last year its unit sales in Russia rose 51 per cent to 2566.

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