ALEX BRUMMER: Refugee from Renault Thierry Bollore making big jump in moving from mass production to image-driven luxury of Jaguar Land Rover
- JLR’s far bigger and better resourced rivals, BMW and Daimler, are throwing everything at developing electric cars that can compete with soaraway Tesla
- It is reported that JLR is seeking a large credit of more than £1billion from the Government’s Project Birch aid scheme
Jaguar Land Rover (JLR) has reached out to car-making royalty in the choice of its new chief executive, Thierry Bollore, who is a refugee from Renault in the aftermath of the Carlos Ghosn scandal.
He arrives at the Tata Motors-owned car maker at a desperate time.
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JLR’s far bigger and better resourced rivals, BMW and Daimler, are throwing everything at developing electric cars that can compete with soaraway Tesla. The luxury British manufacturer has so far developed just one e-model, the Jaguar I-Pace.
Leap of faith: Thierry Bollore arrives at the Tata Motors-owned car maker at a desperate time
The key to JLR’s success in modern times has been its focus on design. It now finds itself hamstrung by a lack of scale compared with competitors. It ran up a loss of £500m in the three months to March before experiencing the very worst of lockdown.
It is reported that JLR is seeking a large credit of more than £1billion from the Government’s Project Birch aid scheme.
Chancellor Rishi Sunak is being extremely tough with commercial firms seeking favours, particularly those which have rich proprietors.
Sunak’s tough line with Richard Branson’s Virgin Atlantic eventually unlocked personal capital from the entrepreneur and matching funds from its co-shareholder Delta in the US.
Tata Motors is run and financed independently of India’s Tata Group, its ultimate controlling investor.
But as Tata is among India’s most successful group of companies, one understands why Sunak might be loath to write a taxpayer cheque.
In much the same way as Rolls-Royce is key to British aerospace, so JLR is a vital component of Britain’s motor industry and home to that most iconic of British vehicles, the Land Rover. It is unthinkable that it would be allowed to fail.
It is not what has happened to JLR’s finances in the peak of the pandemic which is important but what comes next. JLR has begun adjusting, with redundancies of 1,000 staff and £1billion of savings. This on top of a previous package of efficiencies.
Its revival under Tata Motors ownership has been a triumph for overseas investment in the UK. But it has reached a crossroads. The two big issues for car makers are overcapacity and building greener cars.
Bollore has vast experience of both. However, he is making a big jump in moving from mass production to the image-driven luxury sector.
Cleaning up
Reckitt Benckiser is among a small group of British companies equipped to be a long-term winner from Covid-19. Its brands, from Dettol to Cillit Bang, are what every household needs.
So it is no surprise that operating profits powered ahead in the first half of the year. Chief executive Laxman Narasimhan has ramped up a new ‘solutions’ service for companies ranging from Delta Airlines to Avis seeking to improve hygiene.
In a world of deep cleaning and disinfecting Reckitt is perfectly placed. Compass, Mitie and big outsourcers may regret they didn’t get there first. But they don’t have the products, research centres or brands.
The 25 per cent uplift in the share price since the start of the year suggests that investors trust Narasimhan. His predecessor Rakesh Kapoor had a torrid time, including having to handle a death toll in South Korea from a poisonous chemical in humidifiers, complaints about misleading marketing of Nurofen and the opioids legacy parked at spin-off Indivior.
Another inheritance is Narasimhan’s next problem. The accounting punishment of writing down baby food maker Mead Johnson has been taken. Performance is suboctane, with sales falling 4.8pc in the second quarter. Reckitt is known for skill in polishing up bombed-out brands, but the baby formula has defied the magic touch.
Turning it around will be trickier than flogging Dettol in a pandemic.
Shop talk
Selfridges is a store group owned by wealthy people, offering great choice and service for well-heeled tourists.
But with the travel industry nearly at standstill, trade has ground to a halt. The group is having to adjust which means 450 staff, 14 per cent of the workforce, face redundancy. The Weston family-controlled enterprise plans to reshape and focus online.
One can’t but feel that the department store concept is based on a glamorous shopping experience. That can’t be replicated on mobile devices.