Industrial Restructuring and the State: the Case of MG Rover

Abstract

MG Rover was the final name by which the British Leyland Motor Corporation (BLMC) became known. BLMC had been formed in 1968 upon a government initiative to strengthen the UK's automotive industry so that it could compete effectively with the American and other European multinationals in international markets. Within six years BLMC teetered on bankruptcy and was all but nationalised. This paper traces the ongoing secular decline of BLMC through its various stages down to the eventual closure of the Longbridge plant in 2005. In particular it will look at key themes such as investment, output, product development and market failure. In particular, there will be examination of the role of the various owners of Rover such as British Aerospace, BMW and the Phoenix Consortium as well as the part played by the UK government in the company's eventual downfall.

Acknowledgements

The authors would like to thank Paul Benneworth and David Walburn for their comments on earlier versions of this paper.