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The Rover Miracle – Yes There Is Life After BMW

BIRMINGHAM (dpa) – The cellphone of John H. Millett, financial director of the MG Rover Group, still plays the theme tune of BMW- driving secret agent James Bond, but not much else here reminds the visitor of the Bavarian company that once called all the shots.

“Being independent, that’s the best thing,” said Millett, who has served three different masters in his 24 years at Rover – Leyland, British Aerospace and BMW. When the Germans halted blood transfusion last spring the end of “The English Patient” appeared nigh.

Now it seems rumours of Rover’s death were greatly exaggerated.

Once chronically ill, Rover is on the verge of a strong recovery. “We have more money in the kitty than on May 9, the day that BMW pulled out,” said 39-year-old new board chairman Kevin Howe.

“I can hardly believe that we started it all only last June, It seems likes years ago to me.” Howe is expecting Rover to chalk up a loss for 2001 but a “marginal profit” is the silver lining prospect for the year after. The firm is even planning a new mid-range saloon.

Howe looks startled when asked who is going to put up the money for such an ambitious project: “No one – we’ll earn it ourselves. That’s the big secret.”

Last year Rover sold 205,000 cars and projections for this year stand at 190,000. By 2002 that figure should have edged up to 210, 000. “The important thing is that we don’t want to sell a car we can’t make money on,” said Howe.

Under BMW Rover was too optimistic and produced too many cars, said Howe. “Now we’re trying to be very conservative”. That goes for the sterling exchange rate which has beset so many British firms. While many banks believe the British currency will drop back to 2.90 German marks this year, Howe and Millett see the pound not dipping below 3 marks.

Upbeat yes but how is Rover going to pull off what BMW could not manage? When people pose this question Howe packs them off to inspect the assembly lines.

Thanks to ten billion German marks of investment the former “museum of the industrial revolution”, as the Rover premises used to be jokingly called, has been replaced by a state-of-the-art, robotic assembly plant virtually devoid of human workers.

The body assembly line for the Rover 75 has just been transferred from the BMW plant in Oxford. Like giant birds made of steel the robots peck up a floorpan, poke it through the window and weld the panel into place in a flurry of sparks.

“BMW really did invest generously in the plant,” said Howe and the German processing and quality control ideas have been gratefully taken over and copied.

Life without BMW is more straightforward, too. Howe says he doesn’t want to “confuse Rover customers any longer” and the firm has returned to its old adage of Rover being a “car for people who want to set themselves apart from the mainstream”.

More comfort is planned but Rover is not over-ambitious. The MG marque, feather in Rover’s cap, is to be re-launched as a “sporting, aggressive alternative to well, a BMW,” admits Howe.

Millett says the cost of layoffs and servicing loans are over and the listener is inclined to believe him. “It’s not a miracle, we’re just profitable,” said the Rover executive.

The news should provoke smiles in Munich too since if Rover does go into the black next year BMW is entitled until 2004 to a fourth of the profits up to a maximum of 25 million pounds. “And that’s something we’ll be happy to pay,” said Howe with a rare smile.

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