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Outlook: BMW's dog

IT IS hard not to feel a certain schadenfreude as Bernd Pischetsrieder, the boss of BMW, stares into the abyss. When he bought Rover in 1994 for a price which seemed fancy even then, there was an arrogance in his assumption that German efficiency could do for Rover what billions of pounds of taxpayers' money and a spell under British Aerospace's ownership had singularly failed to achieve.

Five years and pounds 3bn of investment later, far from turning Rover around, the old dog looks like being the nemesis of its master. BMW has suffered the humiliation of seeing its profits fall for the first time in years, not because its own brand is faltering, but because of the black hole over here into which it has been pouring funds.

Whilst it is hardy yet accurate to say that the vultures are circling, BMW would be snapped up by any number of bigger and hungrier predators if only the Quandt family could be persuaded to sell. The sale of Volvo to Ford makes the world an even lonelier place for the likes of BMW, which is now regarded as a minnow in motoring terms, even though it churns out more than a million cars a year.

When he took charge, Mr Pischetsrieder, spoke dreamily of the golden days of British motoring and evoked images of everyone driving around once again in Wolseleys and Rileys. And indeed the new Rover 75, a retro version of the stylish saloons of the late 1950s, is, by all accounts going down a storm with the motoring press test driving the car out in Spain.

But it is more likely to be Mr Pischetsrieder's swansong than Rover's salvation. The real gap in the marque's line up is a model that can compete credibly in the medium segment of the market where Rover is woefully represented by the 200-400 series.

Mr Pischetsrieder's rumoured successor, Wolfgang Reitzle, has no such sentimental attachments to weigh him down. Indeed anyone who spotted his cameo performance in the TV series "When BMW met Rover", will recall a cold-eyed fellow whose schedule definitely had no room for the film-wrapped German sausage and sauerkraut so lovingly prepared by the Rover dinner ladies at Canley.

The unions fear Mr Reitzle is the type who could close Longbridge down, tell Tony Blair to keep his pounds 300m in aid and switch production to Hungary without so much as a blink. That would mean 15,000 job losses, minimum, and the first real test of Mr Blair's New Labour free market rhetoric.