When high cost/low volume motor car producer British Leyland wanted Margaret Thatcher to bail them out this is what she said at a dinner given by the Society of Motor Manufacturers and Traders (SMMT) on 6 October 1979…
“This year we have the lowest car production for twenty years. Not because home sales are the lowest – far from it. But because people are buying foreign cars rather than our own. And some of these come from high wage, high exchange-rate economies. The world recession may have exacerbated our problems but it is not the root cause in the motor industry. What has happened to the motor industry since the 50s exemplifies what has been going wrong in too many other parts of British industry; higher pay not matched by higher productivity; low profits so low investment; too little going into research and new design… and why haven’t we had the productivity? Overmanning. Resistance to change. Too many strikes and stoppages.”
As we know, the last part of that message fell on deaf ears and may well be worth replaying in today’s uncertain industry conditions.
Knowing that a sustainable car manufacturing industry needs high volume and low costs to succeed, let’s hope British workers choose to be part of a competitive future that will include cheap car rivals from India and China.
What price our car industry in a recession today? The cost in 2009 included failed businesses, redundancies, production layoffs, industry depression, a status quo mentality at best and the salvation scrappage scheme for many; encouraging people to buy new cars for a discount (that they probably would have had in terms of a p/x price and sales come on…) so they’d scrap perfectly good others with life still in them. And with no real CO2 saving when you factor in the cost of production, knowing that the industry had massively overproduced in the face of this slump.
And the opportunity cost today? Aftersales for starters in terms of garage services for independent garages who may well have lost MOTs, car servicing and repairs for some 200,000 cars. This business (exc MOTs) will have transferred to main dealerships who can be expected to corner this business whilst the new car is in warranty, at least.
How sad we weren’t competitive in the 70s.
How sad that we never seem to see what’s coming when we make short term decisions affecting the UK economy.
…but let’s hope the industry learns to accept a much smaller new car sales market, produces a more sensible number of cars in the short term, cuts its cloth accordingly and turns its attention to encouraging more motorists into garages more often so their cars are safer, cost them less to run in the end and (this outcome is not likely to please car manufacturers) last longer (which is better for the planet).
I’d suggest that this is the time for a female friendly makeover too. Regulate garages and out the bad guys, raise service levels to satisfy professional (and demanding) female customers and employ more women in the industry to tidy the place up for male and female customers alike.
Yes I do have a vested interest in saying so but that doesn’t make me wrong; I honestly do believe the time is right for this and that those that are seen to be female friendly ahead of others will be satisfying a demand for better garage and dealership service levels in future.
FOXY Steph
Female motorists can check a Good Garage Guide for measurable signs of quality when shopping around for cost effective garage services
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