BMW, ROVER AND UNIPART

[Mike Wattam <MikeWattam@domain.elided>]

For those of you who have been listening/watching the news, the 'sensible'
press comments appear below.

For your further information, Unipart supplies all Rover 'official' parts. 
Unipart is an independant company in part owned by its workers, and thus is
in the very peculiar position of being the only 'official' parts supplier
for a vehicle manufacturer which is not owned by them!.  BMW had tried to
buy Unipart on a number of occasions but were rebuffed.  BMW then decreed
that Unipart loses its contract to supply Rover parts in 2002 when parts
supply reverts to Rover.  However, all this is academic to us because the
Stag parts specialists and a division of BL Heritage arrange manufacture of
parts for the classic cars including the Stag.  The only risk for us is
that BMW owns BL Heritage and may decide to close down this activity in
future - it is currently loss-making.  Unipart will carry on as before,
supplying high quality 'pattern' parts for Rover group and other European
cars.

So, on to the press releases;
-----------------------------------------------

1. Change at the top at BMW. Reorganisation and strengthening of the Board.

The Rover situation was one of the topics at the Supervisory Board meeting
on 5.2.99. At this meeting, Bernd Pischetsrieder, Chairman of the Board at
BMW AG, and Dr. Wolfgang Reitzle, responsible for "Market and Product" on
the BMW Board, asked the Supervisory Board to release them from office. The
Supervisory Board agreed and thanked them for their long-term, successful
commitment and dedication to BMW. Professor Dr.-Ing. Joachim Milberg,
currently responsible for "Engineering and Production" on the Board, has
been named successor to Bernd Pischetsrieder. 

Dipl.-Ing. Dipl.-Volkswirt Carl-Peter Forster, Dr.-jur. Henrich Heitmann
and Dr.-Ing. Wolfgang Ziebart have been appointed new members of the Board.
The current head of BMW South Africa, Carl-Peter Forster, will take over
"Engineering and Production"; Dr. Henrich Heitmann, currently responsible
for the North and South American sales regions, will take over the position
of Member of the Board responsible for sales. Dr. Wolfgang Ziebart, project
manager for the new 3 Series, will assume responsibility for Development
Division. 

Source: BMW.

-----------------------------------------------------------

2. PRESS COMENT - CHANGES AT BMW. BMW, the German luxury carmaker, last
night removed both its chairman and de facto number two in a boardroom coup
that could end executive rivalry but will almost certainly leave the group
vulnerable to a take-over bid. The surprise departure of Bernd
Pischetsrieder, chairman, and Wolfgang Reitzle, head of product
development, followed a huge boardroom bust-up that sent tremors through
corporate Germany.

Mr Pischetsrieder will be replaced by Joachim Milberg, the little-known
board member responsible for production. The changes came after an
eight-hour meeting of BMW's supervisory board to assess progress in
improving profitability at Rover, the embattled UK carmaker, bought by BMW
in 1994. The departures rob BMW of two men who have helped make it one of
the world's most profitable car companies. Mr Pischetsrieder, chairman
since May 1993, largely masterminded the Rover acquisition, while Mr
Reitzle's engineering skills are credited for the group's highly successful
models. The boardroom coup was engineered by members of the secretive
Quandt family, which owns almost 46 per cent of BMW.

The Quandts are believed to have grown increasingly dissatisfied with Mr
Pischetsrieder's strategy and the delays in turning round Rover. However,
their attempt to replace him with Mr Reitzle was blocked by workers'
representatives on the supervisory board, triggering the impasse in which
both men were obliged to go. Yesterday's developments sparked criticism of
the Quandts in particular. "It is a scandal," said one industry observer.
Rover's could face a much tougher future under Mr Milberg. The UK operation
is believed to have lost up to DM1bn ($590m, 520m) last year on the back of
poor sales, restructuring costs and the strength of sterling.

Rover's UK market share collapsed to 4.7 per cent last month, putting it
behind not only Ford and Vauxhall, the two traditional leaders, but also
Peugeot, Renault and Volkswagen. While foreign sales have climbed, profits
from exports have been hit by the strong pound. Any more radical attempts
to improve profitability could threaten the future of Rover's Longbridge
plant, near Birmingham, England, the company's biggest but least utilised
factory, which has 14,000 employees. Late last year, Rover won workers'
agreement for a radical new flexibility deal to secure future investment at
the plant.

Although Longbridge had been scheduled to build the new Mini, due in 2001,
BMW had deferred commitments to the successors to the mass market 200 and
400 models until assured of higher UK productivity. The future of those
models will now be in question, amid fears Rover could be reduced to a
niche car specialist focusing on the Land Rover, Mini and MG brands. Bill
Morris, general secretary of the UK's TGWU union, said union leaders would
be seeking an "urgent" meeting with BMW for reassurance that the deal to
bring new models to Longbridge would be honoured . "As far as we are
concerned it is business as usual," he said. "But the situation remains
confusing."

British union leaders were reassured by Mr Milberg's reputation as an
engineer and a "consensus figure" who might end the in-fighting on BMW's
board. "All the unions will be seeking an urgent meeting with BMW and Rover
to clarify the position over the future of the Longbridge plant and end the
anxiety among the workforce," said Roger Lyons, general secretary of the
MSF technicians union. 

Source: Financial Times.

------------------------------

3. THE NEW MAN.  Whilst Professor Dr-Ing Joachim Milberg may not be well
known in the motor industry - certainly not outside Germany - a quick scan
of related websites shows him to be a major contributor and innovator and
board member of the Munich based Institute of Machine Tools and Industrial
Management which is itself part of the University of Munich. A much
respected academic engineer who has been part of the BMW Executive
Committee for some time and very much in charge of production.

Source: Retail Motor Industry Federation

------------------------------

Well, thats all for now, folks!

Mike Wattam
Chairman - Triumph Stag Register