The German state of
Of course, this is no threat to VW’s largest shareholder, Porsche, with around 30.9% of the company. AutoCognition has termed Porsche’s strategy “cuckoo nesting” since the low volume sports car manufacturer has muscled in on its mass market cousin and is now in a position to demand preferential treatment. Only the presence of
Stuck into a massive restructuring, and having already divested itself of most of Aston Martin for £479m, Ford is now looking to sell Volvo – that is if the rumour mill is to be believed. Apparently the interested party is BMW. It has been reported that an analyst at Merrill Lynch values the Swedish company at $8bn, something of an embarrassment to Jaguar and Land Rover which were valued at around $1.5bn in combination by the same analyst.
Although $8bn would be a tidy sum for Ford as it battles with its finances, a net loss of $12.6bn last year and a $23.5bn mortgage, AutoCognition doubts that the answer is to sell one of the most profitable parts of the empire. Indeed, it might be better if the Ford management moved into Volvo’s headquarters and sold the
Quite why BMW would be interested in Volvo is more of a mystery. The two brands compete in a broadly similar market segment, albeit from different perspectives. While BMW majors on driver oriented marketing Volvo has traditionally specialised in family values, recently spiced up with a bit of style. Although this suggests a complementary fit it would also weaken the opportunity for cost reducing commonality between the brands. The only genuine fit for Volvo inside the BMW structure would be with the MINI brand, somewhat isolated with its single model. Although the MINI sells well it suffers from its inability to fully exploit the economies of scale enjoyed by the mainstream BMW models. Perhaps the most sensible option would be for BMW to pool MINI with Volvo in a joint venture with Ford.
Research by What Car? and evecars.com, the web resource helping women buy cars, has confirmed what we already knew: women come off worse than men when buying their cars. We are well used to hearing of the indignity women suffer when faced with hoary-handed service managers saying things like “Oh dear love, your fangle-end needs fettling with a frimbulated fustbuster” before charging five hours to do something simple like adjust the spigots. Of course, some of the reason behind the disparity in servicing costs between men and women is that men are too ashamed to admit automotive ignorance, a cardinal sin on their home planet of Mars, so prefer to claim that they can adjust their own spigots and beat a hasty retreat.
When it comes to the showroom, however, both sexes should be on a level playing field. Since two cars of the same model and specification are technically indistinguishable they should also sell for exactly the same price. However, What Car? and evecars.com have found that the prices women pay for their cars are significantly higher than for men. For example, a woman can pay nearly £500 more for the same Audi A4 as a man, and the disparity is even wider for a Ford Focus Sport. Interesting, there is no difference when it comes to a bog standard Ford Focus 1.6, and women even have the upper hand when negotiating a deal on a Honda CRV.
This raises interesting questions about the way the sexes buy their cars. It should be emphasised that women are not being overcharged, the full list price remains unchanged, but it is all about negotiating a discount. If, for the sake of argument, we assume that men derive much of their status from the car they drive then we can expect them to stretch to the shiniest set of wheels they can get their hands on. The problem for the poor chaps is that even after emptying granny’s piggy-bank there are still not enough shillings to get that Focus Mega-Sport Quattro with the venturi down-thruster and chrome, dare I say, spigots. It then becomes a case of maximum discount or no deal. Women, on the other hand, might be more relaxed about the whole deal and are willing to accept a reasonable discount without getting sweaty palms. Curiously, though, men get their best deal on the Vauxhall Zafira: probably a case of them saying “the only way I am going to be seen in one of those things is if you practically give it to me”. They pay nearly £1200 less than women.
In the latest edition of the Ricardo Quarterly Review (Q2 2007), Anthony Smith gives a detailed account of the
However, for many fans of MG Rover in the
Far from being a Machiavellian strategy, it is unlikely that SAIC took this course without some sense of regret. From the start, an alliance with MG Rover held much promise for the Chinese company. Courtesy of its work with GM and VW, SAIC had built up a formidable ability as an assembler of cars, but had no significant capabilities in vehicle design. Conversely, MG Rover was home to prodigious engineering talent but with production output that was unsustainably low. Although there was probably little difference between the two in their ability to assembly the vehicles, SAIC had access to the massive Chinese market which allowed it to exploit the industry standard economies of scale, an option that was not open to MG Rover in the diminutive
Conspiracy theory would suggest that SAIC had bought the IPR that it valued at a knock-down price from a vulnerable MG Rover. Subsequent events, though, suggest that SAIC was protecting the continuity in product development by looking beyond its relationship with MG Rover. It makes no sense to have approached MG Rover for its IPR on the basis of its capabilities, only to opt to have another firm continue the development. This is further clarified by the events after the collapse of MG Rover when, within five days, Ricardo met with SAIC officials in
Ironically, the team worked in the same building that had housed the ex-Rover engineers employed by Ricardo to help BMW finish the MINI development programme. In the case of SAIC, though, Ricardo 2010 has become cemented within SAIC’s structure. Furthermore, the Chinese company is currently assuming ownership of the unit and renaming it SAIC Motor UK, yet with no intention of reducing the unit’s importance within the Chinese group. Instead, Anthony Smith describes in his article how the centre has been elevated to the status of a ‘home room’, SAIC’s term for an R&D centre that is responsible for a given project. The other two home rooms are in
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