Chairman says cash infusion will lead to new models and expansion – but promises Morgan will remain a small-scale firm.
08 Mar 2019 | 4887 Views | By Mark Tisshaw, Autocar UK
British manufacturer Morgan caused a major stir at the Geneva motor show, when it was revealed that an Italian venture capitalist firm had taken a controlling stake in the company – providing it with a welcome cash infusion.
The amount invested by Investindustrial, which previously took a major stake in ...
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British manufacturer Morgan caused a major stir at the Geneva motor show, when it was revealed that an Italian venture capitalist firm had taken a controlling stake in the company – providing it with a welcome cash infusion.
The amount invested by Investindustrial, which previously took a major stake in Aston Martin, has not been disclosed. However, Morgan says it is a 'significant capital investment' that will allow the 110-year-old car firm to introduce new models and potentially double its sales.
Autocar UK spoke to Morgan chairman Dominic Riley at Geneva, where the company also launched the new Plus Six, about the deal.
Why has this deal happened?
“Look at other businesses with significant capital investment. The long-term benefits of new capital allow us to build our dealer network and invest in new technology. The industry is becoming increasingly technological, with safety and other technology – our R&D can benefit from this investment of capital. We’ll never be large scale but we can develop.”
What interested Investindustrial in Morgan?
“When they came to Malvern Link, they were extremely impressed by the factory, history and craft skills, and they don’t want to change that. But they do want to invest. There are areas we can invest in but retain who we are. We can invest in people. We’ve got plans for a new visitor centre, too. The factory is less than half of the 10 acres we have so there is room to grow. There’s a big opportunity with the museum and other areas, and the council is very supportive. They say we’re the jewel in the crown of Malvern.”
Will they shake things up with management?
“The investment is not happening without the management team to back. The key is the capital to back the management. [Morgan managing director] Steve Morris and the team are so important to the investment. Without him, it wouldn’t happen.”
Private equity firms exist to buy and sell companies. What’s the long-term future?
“It’s too early to say on that. They will invest in the company and grow it, and double production. That’s the business plan. The family retain a share and the management team can share in the commercial value of the business.”
What new models are planned?
“In Jon Wells [Morgan’s design boss], we have an extremely talented individual. He dreams about new models. This will allow some of Jon’s dreams to become a reality.”
Are there more Morgan customers out there?
“There are six billion people in the world and we make 750 cars, so there have got to be more… People [dealers] are keen to promote Morgan in their country. We can now support them with people, PR and events all over the world. We sell 100 cars a year in each of France and Germany but we’re still unknown there. We’ve got the platform to now invest in and support sales and marketing.”
How have staff reacted?
"It’s been very positive. They want the investment and understand the company. Historically we’ve been very cost conscious, now there is a chance to spend sensibly and that excites the staff. Investment improves morale.”