6th October 2010, 01:54
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Senior Member
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Join Date: Sep 2008
Location: Tynedale
Age: 79
Posts: 3,698
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The downfall and demise of Leyland.
Further to some extracts about circumstances at Leyland in the Land train thread ( http://www.truckandbusforum.com/gall...age.php?i=7771 )
Quote:
August 13th 1981
New truck to boost Leyland exports
Bv Clifford Webb
More than 1,200 orders for a new truck, the Landmaster, were announced by Leyland Vehicles yesterday, when the model was unveiled for public view. Designed expressly for African, Asian and Middle East markets, the Landmaster is already in production at its Bathgate, West Lothian, plant but hopes of new jobs in this severely depressed area were quickly dashed by Mr Peter Capon, managing director of Leyland Trucks. He said that the backbone of the company was still its home market and with United Kingdom truck sales halved this year from 80,000 to an estimated 40,000, Leyland was fighting for survival. It had managed to hold its 17 per cent market share but that only amounted to some 7,000 trucks. The picture overseas was not much better because of the effects of inflation and the strong pound. A truck which Leyland and German and Japanese rivals sold in a major African market for £8,000 in December 1978 had seen remarkable changes since. The German price was now down by 13 per cent to £6,950, the Japanese down by 9 per cent to £7,282 while Leyland's price was up by 34 per cent to £10,741. In practice Leyland had not allowed this to happen but had cut its profit margins to the bone to try to stay competitive. In some cases it was selling at break-even prices to retain a market presence. This could not go on indefinitely. Against such a background, Mr Capon was unable to give any guarantees on job security or the future of factories. The 9-12 ton Landmaster is a smaller version of the 40-tons upwards Landtrain launched a year ago for sale in undeveloped countries. When it is in full production of 4,000 a year it will account for about 25 per cent of Bathgate's current sales, replacing the WF truck, first produced more than 25 years ago.
Bathgate production has been severely curtailed in the past 18 months and is now less than 50 per cent of its installed capacity of around 25,000 trucks a year.
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Quote:
August 19th 1981
£50m truck loss puts BL in danger again
By Clifford Webb, Midlands Industrial Correspondent
Record losses of up to £50m in the first half of this year by BL's commercial vehicle companies are endangering the state-controlled motor group's recovery programme only seven months after it was submitted to the Government.
It was on the basis of commitments made then that BL received a further £990m of taxpayers money. In its submission to Sir Keith Joseph, Secretary of State for Industry, on January 26 BL said:
" The plan envisages diminished losses for BL as a whole in 1981 and 1982 and a return to profitability thereafter."
But next week the company is expected to reveal first half losses for the group as a whole of £270m compared with £181m for the same period last year. The continuing failure to stem losses is bound to lead to another onslaught by Tory backbench critics who want to see profitable parts, such as Land-Rover, sold off. The dire state of BL's finances supports the assertion by executives that the warning letter to 71000 car workers was not a negotiating ploy as claimed by union leaders. In the letters BL said:
" In our present financial state we have to consider very seriously whether we can afford to pay any increase at all this year."
Ironically it is the traditionally profitable truck and bus operation and not the much criticized cars side which is accelerating BL's losses. Sources in the industry suggested last night that car losses are being reduced in line with the company's business plan. This points to a half-year trading loss for cars of well below £100m. It lost £93.4m in the first half of last year and was then overtaken by falling market demand which increased its full-year losses to a disastrous £293m. Leyland Vehicles, the truck and bus subsidiary, converted a £9m profit in the first half last year to a £32m loss for the year as a whole. It is ahead of the car side in bringing new vehicles on to the market but has been devastated by a 50 per cent fall in United Kingdom demand for trucks over the past two years. This has seen the market plunge from 80,000 trucks in 1979 to 61,000 last year and a forecast 40,000 this year.
A price cutting war with European importers benefiting from favourable exchange rates has seen profit margins cut and in some cases disappear altogether. Union membership at official and shopfloor level is adamant that it will not modify its demand for a substantial wage increase to come into effect in November after three annual settlements below 6.8 per cent. Some shop stewards insisted yesterday that since the collapse nine months ago of the official BL negotiating machinery they were not surprised by the letter's contents. They regard it as an attempt to put public pressure on full-time officials from the 11 manual unions who will shortly be sitting down to negotiate with BL management.
Engineering union leaders reacted dispassionately yesterday to BL's letter (Donald Macintyre writes). Mr Kenneth Cure, the union's West Midlands executive member, will press local officials and senior shop stewards at a meeting in Birmingham tomorrow to back an an quantified claim for a
" substantial increase " rather than the demand for a 17 per cent rise being canvassed by the unofficial BL Cars combined shop stewards committee. Mr Cure said he saw the letter as no more than the first shot in the battle, part of the continuous process that both sides go in for.
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taken from:- http://www.aronline.co.uk/forum/view...p?f=48&t=13643
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