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Re: Why no MGs?

To: MG List <mgs@autox.team.net>
Subject: Re: Why no MGs?
From: Max Heim <mvheim@studiolimage.com>
Date: Thu, 25 Sep 2003 14:40:18 -0700
Well, of course they have to go through the process. But my point was, a
couple of million $$ and 25 sacrificed cars isn't what's stopping them. It's
more along the lines of what has been mentioned regarding the total lack of
a NA dealer network, combined with the fact that as a small independent they
don't have the capital to build one up rapidly. What hasn't been mentioned
is that they might not have the capital to expand production enough to
justify opening new markets at this time. If their current facility is
capable of turning out only enough cars for the current market, say, then
you are talking a billion or so for a new plant to cover the projected NA
sales.

MG is in an awkward position. Their cars are sophisticated enough to require
modern production methods, the economics of which require mass-market sales.
But to tool up for greatly increased production would require large amounts
of capital which they don't have. They are way beyond Morgan, for example,
which can get away with a 2-dealer US network, and archaic production
methods, because of their low sales targets. There is a reason that every
other British make has been bought out by a large international
conglomerate. The only reason anyone can afford to make Jaguars and Aston
Martins is because of the shared tooling and development with Ford, for
example. MG doesn't have that luxury, and is selling into a more
price-competitive end of the market, to boot. One way to interpret their
racing program is as advertising aimed not to the general public, but to
potential buyers. At the rate they are appparently burning money on
development, it is very difficult to see how they can make it alone; but
that is merely my opinion.

on 9/25/03 1:18 PM, Chuck Renner at crenner@dynalivery.com wrote:

>> I don't know if that is true regarding the saloons and
>> estates. Presumably
>> they meet current EEC standards, which I would imagine are
>> very close to US
>> standards at this time (unless they adopted the lowest common
> 
> Possibly.  But even if those standards are comparable, it would be very
> unbureaucratic for a US agency to simply accept the certification of
> another country.  So even if the car has everything needed, there's
> still the actual certification process to go through.  My understanding
> is that it's not a simple or cheap process.  In fact, if you recall when
> the Nissan Altima was first sold, it still had 'Stanza' on it in small
> letters, as that was still the official model name.  While they
> obviously still had to submit the car for crash-testing, etc., they
> apparently didn't have to do as much as if they were certifying an
> entirely new model.
> 

--

Max Heim
'66 MGB GHN3L76149
If you're near Mountain View, CA,
it's the primer red one with chrome wires




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