I started to dream recently on how different things would have turned out had AEC and BMC amalgamated in 1962
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1961 was a difficult year for the vehicle industry and AEC was scouting around for a partner in the hope that economies of scale could be achieved. Leyland was in discussions to take over the ailing Standard Triumph following successful takeovers of Albion and Scammel in the previous decade. Guy Motors had gone bust and was taken over by Jaguar Daimler.
AEC had supplied engines to Guy for years and they were awarev that Jaguar were talking to ■■■■■■■ about making V series engines at the old Meadow factory adjacent to Guy. Naturally, AEC were deeply worried and initiated merger talks with BMC. In theory AEC and BMC would have been a good fit as the latter made van and lighter truck than AEC. Talks progressed to an advanced stage and in 1962 outline term had been agreed. Then both parties exchanged their profit forecasts. It immediately became clear that the BMC financial situation was dire. AEC walked away and fell into the embrace of Leyland.
To this day I can only dream about what would have happened to Leyland had AEC and BMC were combined. Just imagine a Leyland unrestrained by the dead weight of BMC.
As starters, I reckon there would never been V8 or 500 series engines. There would be no AEC today, no DAF and possibly no Scania or Volvo.
My own what if goes along the lines of the Jaguar BMC merger not happening and only Jaguar then joining Triumph and Rover in the Leyland Group.Recognition that AEC’s truck engine design was hampered by its bus base, Rolls Royce diesels handed to Leyland for no fee.AEC merged with Scammell both at the Southall plant.The T45 cab brought online far sooner ditching the Ergo and Marathon.
Last but not least the idea of so called ‘internal competition’ within a Group is an oxymoron.A sale for Triumph was as good as a sale for Rover and a sale of a Scammell badged T45 was as good as a sale of an AEC badged T45 or a Leyland badged T45 on the Group’s balance sheet.
All moot in an environment in which it had already been decided to end UK as a manufacturing based economy.
BMC would have taken AEC down , the V8 was AEC so nothing for Leyland to worry about even though it was a project not for road going vehicles at the time but Leyland forced it to be put into production
the 500 was pure Leyland so no happy ending there ,maybe AEC would have been the winners had they carried on with double deckers turbocharging and air suspension they were testing at the time
ramone:
BMC would have taken AEC down , the V8 was AEC so nothing for Leyland to worry about even though it was a project not for road going vehicles at the time but Leyland forced it to be put into production
the 500 was pure Leyland so no happy ending there ,maybe AEC would have been the winners had they carried on with double deckers turbocharging and air suspension they were testing at the time
AEC were miles ahead of their time as they were the original " Vertically integrated Manufacturer" the same as Volvo and Scania became in that they produced their own complete drive line unlike Atki/ERF & Foden who were “vehicle assemblers” using bought in proprietary components. I suppose Leyland could be classed the same as AEC but they were inferior in comparison so it was a pity that the Board of AEC threw the towel in and were swallowed by Leyland ! Cheers Dennis.
ramone:
BMC would have taken AEC down , the V8 was AEC so nothing for Leyland to worry about even though it was a project not for road going vehicles at the time but Leyland forced it to be put into production
the 500 was pure Leyland so no happy ending there ,maybe AEC would have been the winners had they carried on with double deckers turbocharging and air suspension they were testing at the time
Yes, BMC would have taken down pretty much any other business. BMC was massive and and was in severe financial difficulty.
Reading between the lines of what Bob Fryars has written, Stokes’ life-time rivalry with AEC meant he initiated the O.700 engine project when he learned about AEC’s V8 plans. He rammed it through the design process without development. When it got to the prototype phase they found it was too heavy and too big to fit under the Ergo cab. So they scaled it down to be the O.500.
Then that was rushed through even faster and as we know , the rest is history.
If Stokes hadn’t ben so tribal then the 700/500 might never have happened.
ramone:
BMC would have taken AEC down , the V8 was AEC so nothing for Leyland to worry about even though it was a project not for road going vehicles at the time but Leyland forced it to be put into production
the 500 was pure Leyland so no happy ending there ,maybe AEC would have been the winners had they carried on with double deckers turbocharging and air suspension they were testing at the time
AEC were miles ahead of their time as they were the original " Vertically integrated Manufacturer" the same as Volvo and Scania became in that they produced their own complete drive line unlike Atki/ERF & Foden who were “vehicle assemblers” using bought in proprietary components. I suppose Leyland could be classed the same as AEC but they were inferior in comparison so it was a pity that the Board of AEC threw the towel in and were swallowed by Leyland ! Cheers Dennis.
But Leyland was also a thoroughly “Vertically integrated Manufacturer” making its own engines, gearboxes and axles etc. They even made its own alternators and starter motors and fuel injectors. The injectors were made in what was called “Nozzle Shop” and that was staffed entirely by women. (Definitely not the place for a student apprentice to go on Shrove Tuesday!!) The diesel injection pump they made was an innovative design however was not up to much in the field.
AEC and Leyland were very similar - hence the massive rivalry and jealousy. They both made truck and buses. They competed for the same customers at home and overseas. Leyland was more successful overseas with a big manufacturing subsidiary in India plus part manufacturing in Australia and South Africa. They were also unique in having wholly owned subsidiaries in other African countries doing assembly and retail.
Admittedly the AV760 was better than the O.680 and had better development potential as seen in the TL12. Had it not been rushed by Stokes, what’s to say that Leyland couldnt do what DAF did with the same O.680.
I reckon Leyland had a better range and was financially stronger especially with Albion and Scammel on board. Had it not been for the contract with London Transport, I reckon AEC would have folded in 1961.
But Leyland was also a thoroughly “Vertically integrated Manufacturer” making its own engines, gearboxes and axles etc. They even made its own alternators and starter motors and fuel injectors. The injectors were made in what was called “Nozzle Shop” and that was staffed entirely by women. (Definitely not the place for a student apprentice to go on Shrove Tuesday!!) The diesel injection pump they made was an innovative design however was not up to much in the field.
AEC and Leyland were very similar - hence the massive rivalry and jealousy. They both made truck and buses. They competed for the same customers at home and overseas. Leyland was more successful overseas with a big manufacturing subsidiary in India plus part manufacturing in Australia and South Africa. They were also unique in having wholly owned subsidiaries in other African countries doing assembly and retail.
Admittedly the AV760 was better than the O.680 and had better development potential as seen in the TL12. Had it not been rushed by Stokes, what’s to say that Leyland couldnt do what DAF did with the same O.680.
I reckon Leyland had a better range and was financially stronger especially with Albion and Scammel on board. Had it not been for the contract with London Transport, I reckon AEC would have folded in 1961.
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It might also be said that it was AEC’s involvement with London Transport that brought them to their knees. Did the cost of producing buses to the high spec demanded by LT get rewarded by a higher price or were the rest of the country, in effect, subsidising LT. Perhaps the huge orders that LT were giving AEC were a burden rather than a boost. If you take a fairly recent comparison when Stagecoach in the late 90’s decided that the bulk of their orders would be going to one supplier there was a Dutch auction to get the business. Transbus were the successful bidder but the discounts that Stagecoach were getting placed a noose round their neck that eventually killed them. After their demise the revamped ADL under the ownership of Soutar et al were getting their buses effectively at cost just to keep the business going. I’m not saying this is a bad thing (if I owned a business I’d want preferential rates) but it came at a price.
ramone:
BMC would have taken AEC down , the V8 was AEC so nothing for Leyland to worry about even though it was a project not for road going vehicles at the time but Leyland forced it to be put into production
the 500 was pure Leyland so no happy ending there ,maybe AEC would have been the winners had they carried on with double deckers turbocharging and air suspension they were testing at the time
AEC were miles ahead of their time as they were the original " Vertically integrated Manufacturer" the same as Volvo and Scania became in that they produced their own complete drive line unlike Atki/ERF & Foden who were “vehicle assemblers” using bought in proprietary components. I suppose Leyland could be classed the same as AEC but they were inferior in comparison so it was a pity that the Board of AEC threw the towel in and were swallowed by Leyland ! Cheers Dennis.
How many AEC products did you buy v ‘assembled’ Atkis Bewick ?.
The vertically integrated model never really worked here as shown by Bedford.
Also the irony of Mercedes buying up Detroit Diesel to replace its old in house designs.
ramone:
BMC would have taken AEC down , the V8 was AEC so nothing for Leyland to worry about even though it was a project not for road going vehicles at the time but Leyland forced it to be put into production
the 500 was pure Leyland so no happy ending there ,maybe AEC would have been the winners had they carried on with double deckers turbocharging and air suspension they were testing at the time
AEC were miles ahead of their time as they were the original " Vertically integrated Manufacturer" the same as Volvo and Scania became in that they produced their own complete drive line unlike Atki/ERF & Foden who were “vehicle assemblers” using bought in proprietary components. I suppose Leyland could be classed the same as AEC but they were inferior in comparison so it was a pity that the Board of AEC threw the towel in and were swallowed by Leyland ! Cheers Dennis.
How many AEC products did you buy v ‘assembled’ Atkis Bewick ?.
The vertically integrated model never really worked here as shown by Bedford.
Also the irony of Mercedes buying up Detroit Diesel to replace its old in house designs.
Hiya CF Happy New Year mate and are you going to behave yourself during 2023 To answer your question regarding AEC it’s “none” although I did fancy a Mercury when I was kicking off as an O/D but the price tag was a tad too tasty for me in 1968 ! Cheers Bewick.
Carryfast:
The vertically integrated model never really worked here as shown by Bedford.
Also the irony of Mercedes buying up Detroit Diesel to replace its old in house designs.
The vertically integrated (VI) ones were the only ones to survive. With your own engines and gearboxes, you were most likely to get an optimise drive line performance.
Bedford were barely what could be called VI because they bought a lot of Leyland 350 and 400 engines for their heavier trucks and busses from Leyland. They also used Turner gearboxes. Near the end with the TM, there was very little in-house content as the engine , gearbox and rear axle were bought in. The TM with the GM engine was unloved and eventually most were fitted with ■■■■■■■■ Then Bedford folded.
The success of the VI model is demonstrated by those makes which have survived, Volvo, Scania, Mercedes, Renault, Paccar, Tata India etc. Then there are the emerging Chinese VI brands which are becoming increasing dominant in all the export markets once exploited by AEC and Leyland.
One aspect I am intrigued by is the fact that the AEC director who scrutinised BMC’s forecast was none other than Jim Slater - the same Jim Slater who set up up Slater Walker Securities. After the merger Slater was later promoted to deputy sales director under Donald Stokes.
It begs the question, if Slater was able to see the alarm bells ringing in 1962 and persuade William Black (The ACV Chairman) to walk away from that deal, why did he not do the same with Donald Stokes in 1968?
Maybe he was concentrating more on his side interests i.e. his developing investment activities. Or was it that Stokes was so egotistical that he coulnt pass up obliging Harold Wilson and Anthony Benn? en.wikipedia.org/wiki/Jim_Slater_(accountant
DEANB:
This article is very interesting from 1986 and i will pop another one on tomorrow from 1987.
Interesting article but it was written after the damage to Leyland Motors ( the original truck company) had been done. It refers to Leyland Vehicles as “the loss making arm of BL”. Leyland Vehicles was only formed in 1978. That was 12 years after the BLMC was formed. The truck and bus division of BLMC had its first loss making year in 1976.
That aside, I reckon General Motors really only wanted the Land Rover part. GM in the form of Bedford folded shortly after 1987 and in the USA their heavy truck division had merged with White trucks in 1980 and then in 1986 it was taken over (85%) by Volvo. So the rump of GM as it survives today would have stripped out Land Rover and flogged Leyland Trucks to Volvo. No way was GM going to get involved with heavy trucks again.
Don’t forget, that Volvo took over Leyland Bus following a management buyout. Volvo then utilised the modern Leyland National bus factory in ■■■■■■■■
At least Volvo could have made a go of Leyland by supplying it with engines. Once Leyland had to be dependent on RR and ■■■■■■■ , it was doomed.
I would have been very happy with Volvo getting involved with the bits that GM didnt want.
That article is quite correct in that GM would have just used Leyland to gain access to markets and technology without any interest in developing the brand. It would have been mimicking the takeover of Chrysler by Peugeot in 1978 when they bought the company for a nominal £1 but took on around £28m of liabilities. After this takeover the chairman of Peugeot was asked (I think in a French publication as I can’t imagine him saying this to a UK journalist) why they got involved in such a loss making operation. He stated that for £28m he got an instant dealer network to sell Peugeot cars that he could never have built in the UK - certainly not for £28m. Their intention was always to gradually move all production overseas and this proved to be the case.
An interesting thread and of course much is supposition and surmise but, from what I have gleaned over the years, any group becoming linked or entwined with BMC was going to be sucked down. Am I correct in thinking that Leyland was almost bullied into taking on BMC by Wilson’s govt? It is well documented that the top brass of BMC were inadequate and, in re-employing Issigonis, put BMC into an era of advanced design that was hampered with unfinished development, poor costing leading to corners cut and possibly too many models. The latter may have been in an attempt to offer traditional alongside modern? Was some of this era’s problem management and government frightened of cutting out deadwood for fear of upsetting voters, unions and of course the workforce?
essexpete:
An interesting thread and of course much is supposition and surmise but, from what I have gleaned over the years, any group becoming linked or entwined with BMC was going to be sucked down. Am I correct in thinking that Leyland was almost bullied into taking on BMC by Wilson’s govt? It is well documented that the top brass of BMC were inadequate and, in re-employing Issigonis, put BMC into an era of advanced design that was hampered with unfinished development, poor costing leading to corners cut and possibly too many models. The latter may have been in an attempt to offer traditional alongside modern? Was some of this era’s problem management and government frightened of cutting out deadwood for fear of upsetting voters, unions and of course the workforce?
Rather than being bullied into Leyland taking over BMC it may be a case of exploiting Stokes’ ego. I can’t Stoles’ political leaning were aligned with Harold Wilson and Anthony Benn but none the less he succumbed to the persuasion. Promise of a knighthood and peerage may have helped.
Being in a Labour Government, Wilson and Benn were eager to do anything to avoid making 400.000 workers redundant in the Midlands. So they did everything the could to avoid this. B<C might have had an innovative design in the Mini but it was expensive to produce and never made a penny net. Also BMC productivity was abysmal - it was 1/2 of Fords and 1/7 of Toyotas. It was doomed because of its militant workforce.
But Stokes was also massively ambitious. Back in 1968 Leyland was small in comparison with BMC. Leyland was managed by hard-nosed management who mostly came up from an engineering background. Stokes was an an engineer but also an ambitious egotist. He had been selected as MD in preference to Stanley Markland who would never ever got involved with BMC had he not left in 1964. Stokes and Markland had been rivals for the job. Markland had been parachuted into Albion and Standard Triumph and gad turned them round to he hugely successful.
Markland would have never have touched BMC with a barge pole. And a different government would have left BMC to wither and die. I worked there and saw it all evolve day by day, month by month. It was most depressing to see BMC unions destroy the UK vehicle industry
essexpete:
An interesting thread and of course much is supposition and surmise but, from what I have gleaned over the years, any group becoming linked or entwined with BMC was going to be sucked down. Am I correct in thinking that Leyland was almost bullied into taking on BMC by Wilson’s govt? It is well documented that the top brass of BMC were inadequate and, in re-employing Issigonis, put BMC into an era of advanced design that was hampered with unfinished development, poor costing leading to corners cut and possibly too many models. The latter may have been in an attempt to offer traditional alongside modern? Was some of this era’s problem management and government frightened of cutting out deadwood for fear of upsetting voters, unions and of course the workforce?
Rather than being bullied into Leyland taking over BMC it may be a case of exploiting Stokes’ ego. I can’t Stoles’ political leaning were aligned with Harold Wilson and Anthony Benn but none the less he succumbed to the persuasion. Promise of a knighthood and peerage may have helped.
Being in a Labour Government, Wilson and Benn were eager to do anything to avoid making 400.000 workers redundant in the Midlands. So they did everything the could to avoid this. B<C might have had an innovative design in the Mini but it was expensive to produce and never made a penny net. Also BMC productivity was abysmal - it was 1/2 of Fords and 1/7 of Toyotas. It was doomed because of its militant workforce.
But Stokes was also massively ambitious. Back in 1968 Leyland was small in comparison with BMC. Leyland was managed by hard-nosed management who mostly came up from an engineering background. Stokes was an an engineer but also an ambitious egotist. He had been selected as MD in preference to Stanley Markland who would never ever got involved with BMC had he not left in 1964. Stokes and Markland had been rivals for the job. Markland had been parachuted into Albion and Standard Triumph and gad turned them round to he hugely successful.
Markland would have never have touched BMC with a barge pole. And a different government would have left BMC to wither and die. I worked there and saw it all evolve day by day, month by month. It was most depressing to see BMC unions destroy the UK vehicle industry
I don’t want to turn this into a political debate but I don’t think any government in those days would have stood by and watched 400,000 jobs disappear. Every government has intervened to protect their base. In 1971 a different colour of government effectively did the same thing with Rolls Royce so it wasn’t just Labour who did this.
Can’t argue about the fact though that BMC was an absolute disaster waiting to happen but perhaps it could have been turned around.
Carryfast:
The vertically integrated model never really worked here as shown by Bedford.
Also the irony of Mercedes buying up Detroit Diesel to replace its old in house designs.
The vertically integrated (VI) ones were the only ones to survive. With your own engines and gearboxes, you were most likely to get an optimise drive line performance.
Bedford were barely what could be called VI because they bought a lot of Leyland 350 and 400 engines for their heavier trucks and busses from Leyland. They also used Turner gearboxes. Near the end with the TM, there was very little in-house content as the engine , gearbox and rear axle were bought in. The TM with the GM engine was unloved and eventually most were fitted with ■■■■■■■■ Then Bedford folded.
The success of the VI model is demonstrated by those makes which have survived, Volvo, Scania, Mercedes, Renault, Paccar, Tata India etc. Then there are the emerging Chinese VI brands which are becoming increasing dominant in all the export markets once exploited by AEC and Leyland.
The hypothetical idea of Leyland being handed RR diesels on a plate for no charge.Would have been a similar, but even more lucrative, situation of Mercedes taking over Detroit Diesel, to at least have created a VI business model which worked.
As opposed to Leyland having to be bailed out by independent ■■■■■■■ and RR engine supplies to make the T45 competitive at 38t for example.
Also bearing in mind that Eaton/Fuller, Allison and other outside specialist component manufacturers still form a large proportion of truck manufacturing worldwide.
While the Euro market has been skewed by protective legislation which has created an equally protected market which makes it impossible to draw any black v white comparisons of VI v assembly, in that regard.
Realistically in the case of engines at least Mercedes had to take in DD to provide it with a competitor to the MX.
Also bearing in mind that an outdated or flawed in house component design has the potential to ruin the whole operation.Which is arguably what happened in the case of Leyland’s reliance on its own in house engine manufacturing operations.
Possibly also later Mercedes if it hadn’t have taken DD in house.
Carryfast:
The vertically integrated model never really worked here as shown by Bedford.
Also the irony of Mercedes buying up Detroit Diesel to replace its old in house designs.
The vertically integrated (VI) ones were the only ones to survive. With your own engines and gearboxes, you were most likely to get an optimise drive line performance.
Bedford were barely what could be called VI because they bought a lot of Leyland 350 and 400 engines for their heavier trucks and busses from Leyland. They also used Turner gearboxes. Near the end with the TM, there was very little in-house content as the engine , gearbox and rear axle were bought in. The TM with the GM engine was unloved and eventually most were fitted with ■■■■■■■■ Then Bedford folded.
The success of the VI model is demonstrated by those makes which have survived, Volvo, Scania, Mercedes, Renault, Paccar, Tata India etc. Then there are the emerging Chinese VI brands which are becoming increasing dominant in all the export markets once exploited by AEC and Leyland.
The hypothetical idea of Leyland being handed RR diesels on a plate for no charge.Would have been a similar, but even more lucrative, situation of Mercedes taking over Detroit Diesel, to at least have created a VI business model which worked.
As opposed to Leyland having to be bailed out by independent ■■■■■■■ and RR engine supplies to make the T45 competitive at 38t for example.
Also bearing in mind that Eaton/Fuller, Allison and other outside specialist component manufacturers still form a large proportion of truck manufacturing worldwide.
While the Euro market has been skewed by protective legislation which has created an equally protected market which makes it impossible to draw any black v white comparisons of VI v assembly, in that regard.
Realistically in the case of engines at least Mercedes had to take in DD to provide it with a competitor to the MX.
Also bearing in mind that an outdated or flawed in house component design has the potential to ruin the whole operation. Which is arguably what happened in the case of Leyland’s reliance on its own in house engine manufacturing operations.
Possibly also later Mercedes if it hadn’t have taken DD in house.
CF, you have deftly swerved the “vertically integrated” argument. Also I can’t see where anyone implied Leyland being handed RR on a plate. As I said, Leyland became dependent on RR and ■■■■■■■■ This was because the inhouse TL12 cost more to produce than the bought in engines
The introduction of the MX by Paccar was part of their plan to become vertically integrated having previously fitted “loose engines” from ■■■■■■■ and caterpillar etc.
Mercedes Benz - Chrysler (as it was then) saw that the US truck market was going VI ands so it bought Detroit Diesel from Penske and at the same time bought Western Star. That way it got an excellent inline 60 Series diesel that the US market liked and it got a dealership network. It also put the squeeze on truck makers who bought in loose engines.
Smart move indeed.
Carryfast:
The hypothetical idea of Leyland being handed RR diesels on a plate for no charge.
CF, you have deftly swerved the “vertically integrated” argument. Also I can’t see where anyone implied Leyland being handed RR on a plate. As I said, Leyland became dependent on RR and ■■■■■■■■ This was because the inhouse TL12 cost more to produce than the bought in engines
The introduction of the MX by Paccar was part of their plan to become vertically integrated having previously fitted “loose engines” from ■■■■■■■ and caterpillar etc.
Mercedes Benz - Chrysler (as it was then) saw that the US truck market was going VI ands so it bought Detroit Diesel from Penske and at the same time bought Western Star. That way it got an excellent inline 60 Series diesel that the US market liked and it got a dealership network. It also put the squeeze on truck makers who bought in loose engines.
Smart move indeed.
It was me who raised the idea of Leyland being handed RR diesels for no charge thereby bringing it ‘in house’ and the question of why not.
Combined with the T45 being brought online far sooner than it was including maintaining the Southall plant housing both Scammell and AEC…
While Leyland’s in house engine products are a prime example of what can go wrong with the VI model and doubt if Leyland nor many others would have survived without buying in Eaton/Fuller transmissions among other driveline components from the major suppliers.Certainly Paccar was built on and only reached its present situation owing to the advantages of the assembly model previously.
There are advantages and disadvantages to both systems and the example of Detroit Diesel and Paccar and what could/might have been with RR, shows that neither are mutually exclusive with each other.
The assembly model can be interchanged with the VI model virtually over night.
To answer your question regarding AEC it’s “none” although I did fancy a Mercury when I was kicking off as an O/D but the price tag was a tad too tasty for me in 1968 ! Cheers Bewick.
