Following the start of Sir Michael Edwardes tenure as chairman of BL, the company was gradually stripped of either unprofitable or ancillary assets so as to help rescue the firm’s woefully poor fiscal condition. Between 1977 and 1986, the company had relieved itself of multiple factories, discontinued numerous brands, rationalised its model range to only a small number of vehicles and had struck up a deal with Honda to help produce reliable and sturdy automobiles. Perhaps the more notable efforts to resolve the issue of profit and loss was the sale of many of the company’s assets, either independently or to other firms.
Jaguar was the first to be sold off, being made independent in 1984 before it was eventually purchased by Ford in 1990. Leyland Trucks and Buses was the next to go in 1987, the bus sector being sold to Volvo while the truck sector eventually fell into the hands of Dutch heavy vehicle manufacturer DAF to form Leyland-DAF. With Leyland Trucks and Buses also went the vans and minibuses sector of the business, which was later to be named LDV (Leyland Domestic Vehicles) in 1993. In the same year, parts provider Unipart, which had been formed by British Leyland in 1974 to provide mechanical components, was made independent and still exists to this day.
However, by far the biggest event during this period was the sale of British Leyland itself by the UK government.
Following her rise to power in 1979, Prime Minister Margaret Thatcher made it her primary policy to undo the legacy of the preceding Labour governments by removing power from the Trade Unions and privatising many of the industries that were now weighing both the taxpayer and the treasury down. British Aerospace, British Airways, British Railways and British Leyland were among many companies which had been allowed to stagnate through a lack of investment from the government that owned them, as well as being riddled with corruption and discontent after the Trade Unions were able to run amok for so long. Aside from removing a very heavy fiscal millstone from around the neck of the taxpayer, the privatisation of these companies also forced them to up their game and become competitive; being thrown out into the turbulent world of the private sector where the cavalry, in the form of a government bailout, wouldn’t be coming over the nearest hill.
To try and divorce itself from the destroyed reputation of British Leyland, the company was renamed Rover Group in 1986 and underwent yet more cuts to try and remain financially afloat. In the same year, the Austin brand was dropped and the company went forward with only two marques left; Rover (with Land Rover) and MG.
1986 also saw the launch of Rover Group’s first new car, and one which it was hoped would become the standard bearer for the company’s new aim towards the executive business market; the Rover 800. The 800 was, for all intents and purposes, a rebadged Honda Legend, but came with internal luxuries and appointments that made it a true executive machine. The car replaced the 10 year old Rover SD1, the last true carryover from the days of BL, and attempted to give the UK car industry a clean slate that would be the envy of the world; comparable to the likes of upcoming BMW and Mercedes-Benz models. Further to the launch of the 800, the years in the run up to the creation of Rover Group were filled with all manner of concepts including the MG EX-E; a 180mph supercar, the Rover CCV; a two-door luxury coupe akin to the Mercedes-Benz 500SLC, the Rover 600; a range of family cars based on the Rover 800, and a variety of other designs.
Rover Group was also incredibly optimistic in terms of where it intended to sell its cars, going back to the old British Leyland obsession with selling units in the United States. The last BL car to be sold in the USA was the Rover SD1 back in 1981; selling only 1,254 units before being dropped due to the 1979 Energy Crisis, the poor Dollar to Pound exchange rate, biblical unreliability and poor production quality. The launch of the Rover 800 was to be the triumph of the new Rover Group, therefore, it was decided that the company would return to the United States; only this time it would be under an alias. Rover felt that because their name had been sullied across the pond by the failure of the SD1 (among other things), the best course of action was to sell the 800 in the USA under the new Sterling marque. This particular brand had been used previously on export models of the Austin FX4 London Black Cab.
The Sterling 825 and 827 were essentially just Rover 800’s but with a few alterations to make them suitable for the U.S. market; being built alongside the regular 800 in UK factories. The production, however, seemed to be about as far as Rover Group was willing to go when it came to developing the project. The Sterling brand was given to a Miami-based parent company known as ARCONA (Austin-Rover Cars Of North America), a move which seemed both cumbersome and expensive in the eyes of the motoring press at the time. While other companies exporting cars to the USA, such as BMW and Mercedes-Benz, would manage sales directly, the creation of an American based subsidiary firm was considered to be adding a middle-man where one wasn’t needed; especially since they were entitled to half of the Sterling’s prospective revenue.
However, hopes were high for both the Rover 800 and the Sterling project, as well as numerous other concepts which seemed to be waiting in the wings to turn the ailing car builder into the envy of the world. The Rover 800 was launched in 1986 as the new face of the Rover Group, followed a year later by the delivery of the highly anticipated Sterling models in the USA. By the time the first Sterling cars arrived in the USA there were nearly 100 dealerships in California, Florida and the northeast seaboard who had signed up and were eager to get their 800’s out the door.
The fever pitch was so thick you could cut it with a knife. However, what was meant to be Rover Group’s crowning moment ended in nothing but disaster.
The Rover 800 sold in mediocre numbers, due largely to the fact that it was once again tarnished by shoddy build quality, unreliability and poor performance. The cancer which had crippled BL was still present and still as pervasive as it had been before; with the Rover 800 being a sales calamity that only ever sold in the UK. While the car did have export models sent to Australia and Europe, the domestic market is truly the only one that was ever interested in Rover’s great white elephant.
Worse still was the Sterling project, which was absolutely trounced in its first year of sales. Against forecasts of 30,000 units being sold by the end of 1987, only around 15,000 actually were; with equivalent BMW’s and Mercedes, as well as the domestic crop of the Mercury Grand Marquis and Buick Regal, outselling the car 9 to 1. From then on, sales of Sterling cars just got worse and worse, the poor reliability and build quality once again being major factors in the inability of the car to sell. It was eventually removed from the market in 1991 and Rover would never set foot on the shores of the USA again.
In the face of these calamitous opening years, concepts such as the Rover 600 and the CCV, even though they were nearing completion, were scrapped; promising ideas which were based entirely on the success of the Rover 800 being thrown unceremoniously away.
Eventually, Rover’s mounting costs and inability to sell cars led to full privatisation of the company in 1988, being sold in a desperate bid to British Aerospace (BAe) on the strict understanding that the company couldn’t be sold on again for 4 years. During the company’s period under BAe, things on the development side went eerily quiet. Between 1988 and 1993 no new models were developed, with only facelifts of existing cars being the primary function of the Rover design teams. The closest thing to a new car built by Rover was the replacement of the original Rover 200 (based on the Honda Ballade) with a model based instead on Honda’s latest family hatchback; the Concerto. The revised Rover 200 was accompanied by the Rover 400, a saloon version of the same car, while in other walks the Rover Metro was given a facelift to try and smooth out its boxy lines.
The reason for such little design effort was down to the fact that cars weren’t selling in numbers that could allow legroom for major development. The only cars being sold internationally were those of the Land Rover and Range Rover marques; but even they were struggling in the face of far more reliable products from Toyota and Mitsubishi. While Land Rover was able to produce results in the form of the mid-range Discovery 4×4, it wasn’t enough to help levy up Rover Group as a whole.
However, in 1991, Rover began to try and regain its identity in the form of a massive facelift programme known as the R17 project. This project was done to help the company take back the reputation it had before the dark days of British Leyland as the blue-collar hero; the car we all aspired to own. The facelift included improved interiors, a massive increase in build quality and production efficiency, new models and, most notably, the fitting of a stylish grille on the front; harping back to the days of the mighty Rover P5. The Rover 800 was the first to receive the R17 treatment, the integrity of the build quality and the flare of the design now making it the car people truly wanted to buy. Even renowned Rover critic Jeremy Clarkson admitted that the post-R17 Rover 800 was a truly decent car and comparable to the likes of contemporary BMW’s and Mercedes-Benz’s.
As mentioned, with the R17 came a slew of new models, some of which were a first for Rover in its entire company history. The Rover 800 finally got the coupe version which had been promised since the days of the CCV back in 1986. The company also brought about its first estate car, the Rover 400 Tourer; a stylish and sporty take on the rising trend in estate models. In 1993, Rover once again dived into the Honda catalogue and brought forward the Rover 600, a mid-range executive saloon based on the latest version of the Honda Accord.
This was a very active time for Rover and things were looking up for the company. However, a three letter word soon rose from across the English Channel to sweep up the British builder and give it the renaissance it had been waiting so very long for.
That word was BMW.