Profile: Rolls man with motor skills: Peter Ward - The man who steered the luxury car company through two recessions talks to David Bowen

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The Independent Online
ONE FEATURE of UK business is the ubiquity of Blobs. Blobs are British Leyland Old Boys, and they have found their way into every cranny of industry. That is not surprising - the company was one of the biggest employers in the country during the 1970s and is now hardly more than middle-sized.

A particularly distinguished group of Blobs served their BL time in the dark days of the mid- 1970s. Their job was to relaunch Unipart, the parts operation, and they created an oasis of profit in a desert of failure. That was not surprising: Allen Sheppard, now ennobled as chairman of Grand Met, was in charge. He was backed by John Egan, later of Jaguar, BAA and a knighthood; John Neill, who now runs a highly successful Unipart - and Peter Ward.

Ward is chairman and chief executive of Rolls-Royce Motor Cars and a managing director of its parent, Vickers. 'We didn't feel we were anything special then,' he says. 'I don't think we would have looked at each other and said, one day . . .' This month, he also became president of the Society of Motor Manufacturers and Traders, making him chief lobbyist for an industry that is bad at getting its views across.

'The classic is the emission debate,' he says. 'Emissions are a tenth of what they were 10 years ago, but we are losing the verbal debate.' Will this not be tricky, given the notorious thirst of the Rolls? 'We meet every Californian emission requirement: I like to feel one wouldn't leave an owner feeling socially unacceptable,' he replies. When unleaded fuel was introduced, he converted every Rolls-Royce to run on it free - starting with the Queen's cars. Maybe that is the sort of marketing savvy the SMMT needs.

Ward is 48. He used to look ridiculously young to be running such a famous company. Now, chubbier and starting to grey, he just looks too young.

He was born a few months after the end of the Second World War with motor oil in his veins. He was brought up in Coventry, where his father was first a mechanic and driver for the Alvis works team, then a development engineer. Like many teenagers in the 1950s and 1960s, Ward became a competent home mechanic by messing around with cars, but his father discouraged him from joining the motor industry. After a short time with the glassmaker Pilkington, though, he switched to Standard Triumph just before it became part of British Leyland. His Dad had just died, and he wanted to find out what was so bad about the industry.

He never did, rising relentlessly in a sector that was in relentless decline. He joined Triumph in 1967 as a junior marketing man and stayed on the sales side as he worked his way up to become sales director at Unipart. The ructions at BL passed him by. 'Middle and junior managers just got on with their jobs,' he says.

In 1979, Ward was hired by Peugeot (which had recently become master of the old Rootes factories) to set up an all-makes parts operation. The launch was successful: once again Ward swept on upwards as industrial storms - this time caused by recession - raged about his ears.

At the end of 1982, he was contacted by a headhunter, who asked if he might be interested in becoming sales and marketing director of Rolls-Royce. 'I thought they'd got the wrong Ward,' he says.

They had not. Rolls-Royce, which regarded itself recession- proof, had been poleaxed as chairmen of mauled companies became embarrassed about driving the ultimate status symbol. The company had been taken over by Vickers in 1980 and was in danger of dragging the whole group under. Sir David Plastow, the former Rolls- Royce chief who was now running Vickers, believed much of the problem lay in an almost total lack of marketing.

At 37, the amiable Ward was given the task of saving the world's most famous car. Garel Rhys, motor industry professor at Cardiff Business School, says Ward succeeded because 'he realised Rolls- Royce was a car producer, not a producer of Rolls-Royces, and had the same problems as other car producers.'

At the traditionalist factory at Crewe, he was regarded with amazement. 'I talked about gross margins and price elasticity,' he says. 'All the things that make people think you have two heads.'

The impression was reinforced when he launched a scheme to promote second-hand cars. But there was method in his madness: if second-hand values went up, he reasoned, owners would be more likely to sell and buy a new Rolls. The ploy worked, and has since been copied by other companies.

Ward's big success was to relaunch the Bentley marque. The last distinctive Bentleys had been built in the 1950s: since then, they had simply been Rolls-Royces with different radiators. He decided that Rolls-Royce had been damaged in the recession partly because its image was a little too opulent, and that a car with a 'softer' image would survive another downturn better. He also believed Bentleys could still be sold on their racing heritage, and asked the engineers to turn the regal Rolls-Royce into something approaching a sports car. They succeeded, and Bentleys now account for more than half Crewe's output.

In 1986, Ward became managing director of the company. In 1990, he was made chairman and chief executive. Things were going well - a little too well. When the next recession struck, he discovered the company needed more than clever marketing to survive.

Not surprisingly, Rolls-Royce was an old-fashioned place full of old-fashioned people. 'It was quite formal - almost baronial - when I arrived,' he says. 'People would resist change by hiding behind talk of skill and quality.' Craft demarcation lines were stoutly defended, leading to inefficiency and low productivity. When he became managing director, he looked for ways of tackling this, and started by installing a computerised manufacturing control system called MRP2. It was designed to cause havoc, and it did. 'It put us through a year of hell,' he says.

The system gave the management an immense amount of new information, but did not alter the traditional Rolls-Royce mentality. 'Until we had a solid database, we couldn't get into cultural changes,' he says.

Meanwhile, sales were growing at 15 per cent a year, leading to a peak profit of pounds 36m in 1990. Then the world collapsed again. For Rolls, this recession was even worse than the previous one, because it hit so many markets simultaneously and hammered the new-rich entrepreneurs in Britain and America. Ward had seen the downturn coming but, like most people, was taken aback by its ferocity.

He had put his plans to tackle the cultural problems to one side as the factory had struggled to meet demand. Now, as the recession slammed in, he had to whip the dust-covers off them. 'It wasn't quite panic, but it would be wrong to say it was beautifully planned and executed,' he says. 'It was obvious we couldn't slow the company down and ride it through: we decided we had to restructure.'

In 1991, the company made a pounds 60m loss as sales halved to 1,700: the 4,000-strong workforce was cut by a third, and Ward told the remainder that they would have to abandon their craft demarcation lines and accept a total organisational revamp. By now, the press was full of speculation that Vickers would sell Rolls-Royce. The New Zealander Sir Ron Brierley tried to force the board to demerge the company, and there were talks with BMW. But, Ward says: 'The 'for sale' thing got exaggerated. We had discussions because we were pushed into them by shareholders, but we were not looking to sell.' Does that mean Vickers will never sell? 'Never say never,' he cautions.

Last year, sales were down to 1,400, but breakeven was even lower, at 1,300, and the City believes Rolls-Royce managed a pounds 3m profit. This year, volume has been rising as the Far East has taken up the slack in the West. When the world economy is really rolling, profits should be spectacular, allowing the launch of the next Ward creation, the all-new small Bentley, codenamed Java, which was presented as a concept car last year.

Ward refuses to blame 1980s excess for Rolls's subsequent problems. 'The Eighties was getting Britain back on its feet,' he says. 'I want to get to get back to that level of excitement.'

Professor Rhys believes Ward has kept Rolls-Royce alive through the recession, but that more fundamental problems could eventually threaten it. 'If it hadn't been for the new Bentleys, one can only wonder what sales would have been and whether Vickers could have kept the company going,' he says. 'But one of the imponderables is what happens if society turns against cars like the Rolls- Royce for social or environmental reasons.'

Meanwhile Ward has become one of two managing directors at Vickers, and is busy moulding the new propulsion technology division into shape. He is only 48, and will certainly head Vickers - or another large company - one day. He will not admit to any great ambition, though. 'I'm not driving for big goals,' he says. 'I just have to have a job that interests me.'

(Photograph omitted)