Opinion: JLR and BMW is an old alliance rebooted

Jaguar I-Pace nose

It shouldn’t come as that big a surprise to see the two brands partnering up on electrification

Nineteen years ago, BMW’s ownership of the then Rover Group was about to hit the rocks. Into its fifth year, the Rover 75 saloon had just arrived in showrooms but, behind the scenes, BMW – then a much smaller company – was spending big on engineering the Range Rover 3, the all-new Mini and a new compact Rover model.

But a failure to secure government support for a total rebuild of Rover’s ancient Longbridge site (which saw complaints made to the EU) triggered a downward spiral.

It quickly became clear the Rover 75 wasn’t going to be a big enough success, engineering for the new Rover R30 compact model was well behind schedule and progress on the Mini and Range Rover 3 had also been stuttering.

Worse still, the old Rover Longbridge site was a dead end, partly because of incoming environmental restrictions on the paint shop, which would have capped production. Without state aid to re-develop it, Longbridge was of no medium-term use.

However, the realisation that the Rover Group had run up debts of £750 million in 1999 (£1.28 billion in today’s money) was the decisive factor. Trying simultaneously to reinvent the Rover, Range Rover and Mini brands was clearly far too ambitious for BMW’s bank account.

As a consequence, BMW broke up the Rover Group, selling it off in early 2000, with Ford taking over the valued Land Rover operation, where it joined Jaguar in Ford’s Premier Automotive Group.

It’s said BMW’s corporate love for the Land Rover brand was such that handing over the Range Rover 3 project from Munch to Ford caused grown men to weep. There again, Ford purchasing managers probably wept at the unit cost of each of the specially developed BMW engines needed for the Mk3 Rangie.

Despite the traumatic Rover Group break-up (it led the newspaper headlines for weeks), it’s easy to forget that BMW’s big – if frustrated – plans for the Rover Group left behind a significant industrial footprint in the UK.

The Hams Hall engine plant has been producing BMW four-cylinder engines since 2001, for both Mini and for export. The Oxford factory that produced the first Rover 75s was switched to making the BMW Mini. BMW built a new-generation Rolls-Royce plant in Goodwood and it also has a pressing plant in Swindon.

BMW is a significantly ‘British’ automotive brand – more so than Ford, you might argue. BMW’s influence at Jaguar Land Rover (JLR) is also notable, with boss Ralph Speth arriving from Munich to run JLR, along with other senior engineers.

BMW’s tie-up with JLR sees two things coming together nearly two decades on: BMW’s commitment to the UK and the remarkable similarity of BMW’s and JLR’s future platform strategies.

BMW’s CLAR and JLR’s MLA architectures are, in outline, very similar: one natively rear-wheel-drive platform that can be sold as in combustion engine, hybrid, plug-in hybrid and in pure EV forms. The sheer expense of upmarket brands shifting to multi-fuel, electrified platforms with a side order of autonomy is something even the premium giants struggle to finance alone.

So it’s ironic that BMW very reluctantly let Land Rover go in 2000 because of the sheer size of the investments needed, but now turns to its old subsidiary to help it shoulder the burden of electrification.

Of course, with JLR currently in something of a financial crunch and with no solid plans for the next-generation Evoque and Discovery Sport family, speculation will turn to the possibility of future co-operation with BMW.

If JLR owner Tata decides to stick things out and not sell a stake in its UK car maker, bespoke deals involving small platforms – where, analysts argue, BMW is still sub-scale – and co-operation on future small engines and hybridisation probably shouldn’t be ruled out.


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Source: Autocar

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