Ford moves in Jaguar

THE OBSERVER
By Lindsay Vincent

'Sure, the fact that I am English made all the difference. If they did not have me, they would have had to made me' The Union Jack still flies above the Coventry headquarters of Jaguar Cars along with one for a Queens Award To Industry and the corporate flag--in British Racing Green. But since November, the company's masters have been in Motown.

Last week to the surprise of few, the Ford brass in Detroit disclosed that Jaguar's chairman, Sir John Egan, a prominent if erstwhile hero of the Thatcher era, would be stepping down in favour of one of its own. But Detroit have not made Bill Hayden chairman of Jaguar because he is English. The fact is that Hayden knows as much about motor car manufacturing as any one in Europe. For Ford it is a bonus that he is home-grown.

Hayden, 61, is unique. He was the first non-American to become what he calls 'a corporate officer' of Ford - a vice-president indeed - when he was elevated to head of manufacturing for all Ford's European operations. His new job is one of the most coveted in the motor business. But the kudos and prestige is acutely balanced by the scale of the challenge that confronts him. Hayden calls it 'a gamble'. Few would disagree with him.

The fact is Ford paid $2.4 billion for a company producing 50,000 cars a year and earning little or no profit. General Motors was the under-bidder for Jaguar and withdrew when it saw the size of Ford's chequebook. Not only does Hayden have to move Jaguar into profit, but he takes over when the Japanese are relentlessly moving into the luxury sector of the car market - long the preserve of Mercedes-Benz, BMW and Jaguar, along with a handful of minority marques - and when recessionary pressures are building up in Jaguar's traditional markets.

Hayden has a ten year plan for Jaguar which he will present to his Detroit masters toward the end of this year. It will mean more models, more cars and, he believes, ' a decent return on Ford's investment.' The trick is to preserve what Hayden terms 'the aura of Jaguar' and not bang out cars regardless.

'A luxury product gets a luxury profit,' he says. 'The problem is to get sufficient volume to justify it.'

For this reason, Hayden's game plan is to increase total production to around 180,000 cars a year. By way of contrast, in the first half of last year, BMW sold more than 240,000 cars in Western Europe alone.

Hayden, whose gravel voice comes from calling the shots over the years, entered the motor industry aged 20, when the car was even more the ultimate consumer item than it is now. 'I would go into it now if I was 20,' he says, though he acknowledges that, by the time he reached 61, 'personal transport might not necessarily be like it is today. But there will always be a need for it; and there will always be someone who wants to travel in more luxury than others.'

Born in West Ham, in London's East End, Hayden was motivated by two things as a young man---money and motor cars. His father worked in ship repair and, outside the war years, could never be guaranteed work. Custom House, the area in which he was brought up, was badly blitzed during the war and Hayden was evacuated to Romford and its technical college. His first job, however, was anything but technical. He had an aptitude for figures and a headmaster 'who had a pal who was a stockbroker.'

'Without any great deal of thought', Hayden became a blue-button - a lowly messenger on the Stock Exchange floor, then a traditional City outlet for likely lads from the East End - and returned to Throgmorton Street after National Service, largely spent in Germany. He did not stay long. Cars were a young man's passion and Hayden landed a job with Briggs Motor Bodies, responsible for Ford bodies and cars of long-gone shapes, such as the Jowett Javelin, which Ford itself acquired when the US owner of Briggs died in the early Fifties.

Hayden then joined Ford's finance department - 'finance has always been a strong discipline in Ford' - where colleagues included John Barber, subsequently managing director of British Leyland, and Allen Shepperd, he of Grand Met, the beer-to-burgers enterprise. He went on to become the figures man behind the launch of the Cortina and justified the building of Halewood, Ford's chronic problem in Merseyside.

Hayden stayed in the fast lane and in 1973 took on the responsibility of all Ford's European manufacturing operations, a job he held until last May when Ford sent him to Detroit to head R&D and design. The day his wife arrived from England to buy a house was the day Ford bought Jaguar.

'They told me I had better go back.'

Told that he could pick his own team Hayden moved into Jaguar in January. Two weeks ago, Egan told Hayden he was planning to quit. Hayden says he knew he would get the job. Working with Egan was 'suddenly different, it was rather peculiar.'

Hayden admits to some culture shocks. Ford makes more than two million cars a year from mass production lines where every penny counts. He is now in a business where luxury counts and notes that the diversification is 'very important for Ford. We bought it for the image of Jaguar and the marque. The factories are not worth $2.4 billion. We have to update and protect the marque and keep it as an entirely separate entity from Ford. This is one way of protecting that $2.4 billion,' which, he says, is a lesser figure than Ford would have spent to start a luxury car division from scratch . With yet another disruptive labour dispute solved last week, Hayden admits that he finds some archaic practices at Jaguar.

'There are two unions here that I thought went out 20 years ago. And there are more sheet-metal workers here than in the entire business of Ford Europe. There have been lots of little stoppages for such a small company, but with time and understanding we will sort it out. With Toyota and Nissan entering the luxury market we will have to learn to fight together and not each other. I am sure we will.'

As for management, there have already been 'violent discussions' about the way forward. Hayden will not say what he intends to do beyond extending the size of the XJ6 'and replacing it some time.'

He says he is loath to talk about his plans since 'there would be a constant searchlight on the company and that would bother me.' But Jaguars plans are known to include a smaller car to compete with BMW, and enhancement of the Daimler marque and something new and sporty. Hayden will not say how much expenditure the expansion will require, but will say that he does not have an open cheque book.

'At Ford there is no such thing.'

He stresses the Japanese threat and says the leather and walnut skills of Jaguar will have to be adapted to meet longer production runs. Overall, he is no fan of the British worker or British management.

'They do not have flair, ingenuity, or drive. I sum up the UK nature by telling people we invented all the games that are popular in the world.'