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Thursday, April 6, 2023

MG at 100: British auto icon thrives under Chinese ownership - Automotive News

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As Bruce Qvale crossed a street in downtown Paris last month, a vehicle with a familiar octagonal badge caught his eye as it passed by.

Says Qvale: "It's a normal-looking crossover, but it's got MG badges on the front and back." His reaction: "That's an MG?"

In the 43 years since the last MGB roadster came to America, everything has changed for MG. So much so that, like what Qvale experienced in Paris, MG is no longer recognizable to its former American dealers, customers and fans as it begins its second century.

The names Qvale and MG are linked in automotive history. In 1947, Bruce's father, Kjell Qvale, helped ignite the British sports car craze in America when he became the West Coast distributor of the brand of affordable, fun-to-drive lightweight roadsters.

Masterful promotion coupled with an emphasis on providing parts and service kicked off a sales boom for MGs (and other British sports cars, such as Triumph and Austin-Healey) that spread from California and went nationwide. Annual sales in the U.S., MG's largest market, peaked at nearly 35,000 in 1977, according to data from historian David Knowles. The ride lasted until fall 1980, when the venerable MGB went out of production and was never replaced in the U.S.

Though historians disagree on MG's exact beginnings, it's been 100 years since the first MG sports cars were conceived. There are several commemorations marking the anniversary scheduled in England this spring and summer.

But the only thing today's MGs have in common with the beloved classic sports cars of the past are its stylized "MG" inside the brand's famous octagon logo.

MG has been owned by Chinese automakers — first Nanjing Automobile and now SAIC Motor — for nearly 20 years. MGs are no longer made in Great Britain, though some advanced design and engineering work is done in a London studio.

Qvale, who sells Alfa Romeo, Volkswagen, Maserati and Audi vehicles in four central Florida dealerships, says: "I knew the Chinese had the name, but I didn't know what they were doing with it."

The MG brand is on a tear globally. It looks poised to become one of the first Chinese brands to grow into a major global player. As a result of SAIC pumping untold billions into MG, there are more MG-badged vehicles sold in more countries than at any time in the brand's 100-year history.

MG is among the top 10 selling brands in 20 countries in Europe, South America and Asia.

In 2022, more than 660,000 MGs were sold globally, a record for the brand.

MG is also successful in North America. It is among Mexico's most popular brands, outselling even Hyundai and Ford in recent months. In February, MG was Mexico's eighth-best selling brand, according to Mexico's Instituto Nacional de Estadistica y Geografia.

In January, an MG compact crossover called the HS was Britain's top-selling vehicle — the first time in MG's history that any of its models topped the sales charts there.

Under SAIC, it has been recast as a wide-ranging value brand. The MG lineup consists of a broad range of vehicles from the Comet, a two-seat electric microcar available in India, to the V80, an 11-passenger van offered in Southeast Asia. There's even an MG-badged pickup, the ExTender, also sold in Southeast Asian markets such as the Philippines and Thailand.

MGs are contemporary looking, not retro-styled. They're built with whatever safety and emissions equipment each market requires, along with high-tech features such as hybrid and electric powertrains, navigation systems, large colorful screens, infotainment systems and other features that, to American MG fans at least, might seem out of place. Under previous corporate owners, MG was never among the leaders in introducing new technologies.

SAIC has had help with developing some of MG's current platforms and technologies from an unlikely partner: General Motors.

GM and SAIC co-own PATAC — the Pan Asia Technical Automotive Center in Shanghai. Some MG and GM vehicles share a co-developed 1.5-liter engine, internally referred to as SGE, that is tuned specifically for each brand.

And some vehicles, such as the Chevrolet Captiva and Indian-market MG Hector, as well as the Chevrolet Cruze and MG5, are based on the same underpinnings, according to Car News China.

The SAIC-GM connection also includes production of Chevrolet, Buick and Cadillac, and Wuling and Baojun brand vehicles made in southwestern China in a different joint venture.

The only type of vehicle missing from MG's lineup is the one the brand remains most famous for, a two-seat convertible sports car.

Next week at the Shanghai Auto Show, SAIC is expected to show the production version of a battery electric two-seat roadster that, in concept form, it has been calling the Cyberster. The first new MG sports car since 1995 could launch in Europe, China and elsewhere in 2024, possibly named the MGC EV.

That begs the question: Is MG, the import brand America loved first, ready to return to the U.S.?

The answer: No. "We currently have no plans to sell vehicles in the U.S.," Joyce Ying, SAIC spokeswoman in China told Automotive News in an email.

A recent interview with Zhao Aimin, executive vice president of SAIC International, in the China Daily gives an insight into SAIC's global strategy.

"At SAIC, we don't bite more than we can chew. We respect every market and every customer," he told the newspaper. "We try to better our products and services in existing markets and avoid overreaching ourselves by entering too many destinations."

One of the most important ingredients of SAIC's success in overseas markets, he added, "is to offer competitive products based on an understanding of local customers' demands."

At least one industry analyst says MG's successful global expansion doesn't mean a return to the U.S. someday is imminent — even with a sports car as a halo vehicle.

"The U.S. market is getting more complicated," said Stephanie Brinley, principal automotive analyst at S&P Global Mobility. Because MG has been gone from the U.S. for decades, its previous success in the U.S. won't mean much to today's buyers, she says.

If MG were to return to the U.S. with the same strategy that has made the brand successful globally, the vehicles would likely be priced slightly lower than Hyundai and Kia models and could stake a claim as a value brand.

But even that would be a difficult strategy to execute successfully, Brinley said. What MG can't do is just offer a lower-priced vehicle that doesn't have the safety equipment and features consumers want, she added.

"If MG can figure out a way to offer technology and a cheaper price than the competition, there may be an opportunity here for the brand. But I am not sensing that is a priority right now," she said.

Qvale also isn't sure how the recast MG brand would fare today in the U.S. "The competition is so immense. Though I am not familiar with the quality of the car, anything is possible. The power of a company [SAIC] that big can make a lot of things happen," Qvale said from his office in Boca Raton, Fla.

"The brand name, to me, is the problem. What does it mean to those under 60? I'm not so sure. MG could come back, no question about it, but it has to be focused as far as the sector it goes in and the pricing. If the cars are good, MG has a chance, but it is an uphill battle," Qvale added.

It's unclear how political tensions between the U.S. and China could affect consumer attitudes toward the brand. In MG showrooms around the world, SAIC plays up the brand's British heritage with posters of classic MGs, and it frequently refers to MGs as being from Morris Garages, where the initials MG originated.

Qvale notes that most Americans know their cell phones are made in China and that doesn't affect sales.

Some automotive love affairs die hard, and even though MG customers from the early 1980s and before are not young drivers anymore, they still love the brand — even the cars MG never sold here.

Ken DeLeeuw, a retired UPS driver from Michigan who lives in West Palm Beach, Fla., runs a Facebook group dedicated to MG owners who have imported MG sports cars made in the 1990s. Vehicles that are 25 years old or older can be imported and legally registered in most states.

The group's members live in 24 states have more than 70 MGs, mostly the MGF sports car that was popular in Europe from 1995 to 2005, but not offered in the U.S.

"I was in Chile before COVID and stood next to an MG3. It was like $7,900. I loved it," said DeLeeuw, who owns three MGFs, one from 1996 and two 1998 models.

"I would probably be a buyer if MG came back to the U.S. I hear they are very good, and I would seriously consider buying one. Even though it is no longer British, it's still an MG. If you are a fan of Toyotas and Hyundais that are now being made in the U.S. you'd buy it. You are going to have the old-school people who'll say, 'Oh, it's not an MG'. But SAIC bought the marque. They are entitled to make the brand, and if it's a nice car, I'd drive it," DeLeeuw said.

Andy Lincoln, an MG owner in San Diego, has driven several of the SAIC-built MGs in the U.K. and would consider buying one here.

"I've rented a few MGs in the U.K. Some have been quite good. I am not a fan of the midsize SUV; the CVT in that was disappointing. But I'd be more than willing to evaluate their small sedans or coupes," he said.

As for Qvale, the Florida dealer who grew up with MGs, he says if SAIC decides to return the brand to the U.S. someday, MG is a franchise he'd consider adding. "I'd take a look at it," he says. "I'd have to. It's in my blood."

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MG at 100: British auto icon thrives under Chinese ownership - Automotive News
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