BIRMINGHAM - Rover Group took a crucial step toward profitability when the wraps came off its long-awaited 75 model.
But it was ironic that the milestone sedan aimed at revitalizing the brand was launched on the day that BMW AG voiced concern over the long-term viability of its British subsidiary. (See story on Page 23.)
In spite of problems created by the combined effect of the strength of sterling and low productivity at Rover, Chairman Walter Hasselkus declared the culmination of the £700 million ($1.1 billion) R40 development program as a momentous day.
'We are here to celebrate the renaissance of Rover. This car will re-establish both the role and positioning of the brand in a way which no other product has done since Rover Group was created 12 years ago,' he said.
Hasselkus claimed the luxury model was 'uniquely British' in its elegance, class and style and said it represented a belief in the excellence of British automotive design and engineering. BMW Chairman Bernd Pischetsrieder said the 75 represented the rebirth of Rover. It pointed to the direction the brand was taking to recapture its heritage. Hasselkus said he still hoped Rover would reach break-even in 2000, even though achieving that goal was now more difficult than had been originally thought.
'I accept that the 75 will not provide a total solution to Rover's problems, but it will go a long way to taking us back to profitability. It is our first step before we move to a new medium-size car,' he said.
UK showrooms will get first supplies of the 75 in March, but officials are aiming for pan-European availability by the end of April. It is expected to reach all 130 Rover Group markets, but a decision has yet to be taken on selling the car in the USA.
'We would like to return to the USA in two years' time, but we need to prepare a dealer network and our research is not complete,' said Hasselkus.
Even so, the 75 had been created as a global product, said design and engineering director Nick Stephenson.
'We have engineered it to US standards, but we'll wait for the decision before certification happens,' he said. 'I'm thrilled it has won such an enthusiastic reception, because the car needs to re-ignite the brand - and I think it can.'
Stephenson said leading edge technology had been clothed by styling reminiscent of previous Rovers. 'We were given complete freedom to execute the 75 as we felt. For once, we didn't have to be compromised by limits on investment.
'We make no excuses about this car. It is our own piece of work, but it's been backed to the hilt by BMW's technical resources. The body structure is three times stiffer than the 600, and I'd rate it as an excellent platform for derivatives.'
New manufacturing facilities costing £400 million have been built for the 75 at the Cowley plant in the UK, now re-named Rover Oxford.
Described as a factory within a factory, it includes a £78 million paint shop capable of 250,000 annual throughput, advanced welding facilities, new final assembly lines and a logistics center which allows the supply of key parts to the tracks through underground tunnels.
Combined output of the 600 and 800 series, which the 75 replaces, reached a peak of 92,000 in 1996. Expected initial volume of the new model is around 120,000, although an agreement on flexible working could allow that to rise to 150,000.
Exports of the 75, which will carry UK pricing in the £19,000-£25,000 range, are expected to account for 70 percent of volume.
The Rover 75 is 4750mm long. Power comes from three gasoline engines from 1.8-liters to 2.5-liters, plus a 2.0-liter turbodiesel. The car will be pitched against the Mercedes-Benz C-class, Audi A4 and the Alfa Romeo 156. It is seen by Rover as an ally for the BMW 3 series in the quality car market.
'The 75 will be attractive to the European customer,' said Garel Rhys, an auto industry analyst at Cardiff University in the UK. 'I think it will be a success, but I wouldn't say it will be a major success. It needs to be followed up quickly by other products.'