Sales Skid Triggers MG Rover Marketing Drive in 2005

20 December 2004

MG Rover, the battered remnant of the UK's indigenous auto industry - fifty years ago the world's largest after the USA - reported last week that 2004 sales will fall below 125,000 units.

The shortfall is 25,000 below the 2003 figure, confessed Rod Ramsay, managing director of sales, who acknowledged that UK consumers had lost confidence in the Rover marque. This year's sales are the worst in a decade.

But the automaker hopes to halt the slide in 2005 by extending its dealer base, slashing prices and the introduction of new models. And the cash to underwrite these plans will hail from that new bastion of state capitalism, the People's Republic of China.

MG Rover is on the verge of a lifesaving deal with the Shanghai Automotive Industry Corporation, reportedly poised to invest around £1 billion ($1.94bn; €1.46bn) in the ailing business.

Control of the once revered British brands will pass to SAIC which is expected to acquire around seventy per cent of the UK company's stock in return for its investment.

Ramsay promises improved performance in the medium term, with the launch of new models and the expansion of MG Rover's dealer network with thirty new franchises in the UK and one hundred in mainland Europe.

Until then, however, he concedes that sales are likely to continue their decline.

Data sourced from BBC Online; additional content by WARC staff