By Peter Woodman, Transport Correspondent, PA News
The Phoenix consortium takeover will only be a stay of execution for Rover
unless the company develops new products, motor industry experts said today.
Production had to reflect the reality of the market place, said Mark Norman
of the CAP Motor Research company.
But the Phoenix deal was undoubtedly "a shot in the arm" for the British
motor industry, he added.
"The deal does not get over the initial problem of Longbridge needing a lot
of development. It's a very, very old factory and it will need a lot of money
spent on it.
"If Rover now just stands still in terms of investment and new products, then
the Phoenix plan will merely be a stay of execution for Rover. Potentially,
the Phoenix deal presents a fresh start."
Mr Norman added: "I believe Phoenix can make a go of it by producing at lower
levels. In the past, Rover has sold cars in sectors of the market they should
not have been in.
"The company has been producing far too many vehicles. One good thing about
today's news is that it should encourage British consumers to back British
cars.
"The French love their Renaults and the Germans love their Volkswagens.
Britons don't seem to support their own cars in this way."
Mr Norman said that with Mini production staying with BMW, Rover really
needed to produce a small car to replace its old Metro/Rover 100.
He added that the Phoenix deal was "good news all round". He went on: "For
BMW to have pulled out of Rover wholesale would have been disastrous for its
image. Everyone has saved face and BMW can leave the scene not looking like
the bad guys."
Professor Garel Rhys, director for the centre for automotive industry
research at the Cardiff University Business School, said today: "Phoenix
really has to join with a major car company if it is to bring in a range of
new products."
He went on: "Unless there is a link-up with another company then this deal is
merely postponing the inevitable. But it is clear from last month's new car
figures (when only Ford outsold Rover) that if the price is right, people
will buy Rover cars.
"All the workers have an incentive in ensuring the new deal is successful as
the redundancy terms they might get in, say, five years' time are far less
attractive than what they could get now."
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