Callum Bentley speaks with UK engineering visionary, Professor Lord Kumar Bhattacharyya.
I’m sitting on a blue faux-leather couch – something that wouldn’t look entirely out of place in the latest Ikea catalogue – yet I’m in a considerably moderate boardroom at Warwick University awaiting Professor Lord Kumar Bhattacharyya.
He has been high on my “to interview” list for some time. After all, this is the man who made what could turn out to be one of the most profitable and prosperous introductions in UK manufacturing history – the coupling of Jaguar Land Rover (JLR) and Tata.
When he arrives, Professor Bhattacharyya walks in with a warm smile, we exchange pleasantries and he sits down, reaching forward for a plate of biscuits, which sits on the table in front of us.
He’s been in enough meetings with upper level individuals to not worry about tucking into a Hob Nob while in conversation with a business journalist.
I’m here to talk to Bhattacharyya about, among other things, the new £150m JLR-funded National Automotive Innovation Centre (NAIC); a project he says, is unlike anything that is being done in the automotive sector anywhere in Europe.
One of Bhattacharyya’s biggest gripes with the way the UK automotive industry currently operates, is that the current level of research and development (R&D) is done overseas, something he hopes the new centre can help.
“If you look at all the R&D scoreboards, British industry is among the worst in the world,” he says. “Besides maybe one or two of the bigger companies in areas such as pharmaceuticals, we don’t have the R&D happening at the right level.
“If you look at the automotive sector, the majority are Japanese companies who don’t do any R&D in this country, or very little, because it’s all done in their home country. Here they just assemble for the European market.”
There is also the question of the flow on effect for R&D in the supply chain – another reason Bhattacharyya encouraged the charters of Warwick University to engage with JLR to establish the centre, stating that quite often the technologies which are established at centres like the NAIC, are and always should be transferrable into other companies besides just JLR.
It’s easy to tout the impressive investment figures of JLR’s recent success, a quick internet search will attest, but just how sustainable is this growth, and can the UK supply base keep up?
“It’s sustainable at the moment because, other than a set of small companies, there isn’t really any competition. The British car industry which used to do the development in this country has now disappeared.
“Now JLR is owned by Tata, all the work is done in this country. So the greatest advantage for JLR is that it can be a pathfinder for others as well. We haven’t got any lack of technical knowhow or a lack of understanding as to what is required and we have got brilliant young minds; if you put these things together, the potential is great.”
Professor Lord Kumar Bhattacharyya KT CBE FREng FRS
Professor Lord Bhattacharyya was born in Dhaka, India, and after graduating from the Indian Institute of Technology, Kharagpur, he was invited to become a graduate apprentice at Lucas Industries in the UK.
After completing his graduate apprenticeship, he was offered the Lucas Fellowship and entered the University of Birmingham where he attained an MSc in Engineering Production and Management and a PhD in Engineering Production.
In 1980, he was invited to start a premier manufacturing, teaching and research group where he became the Professor of Manufacturing Systems. From this stemmed the Warwick Manufacturing Group (WMG).
Bhattacharyya has built WMG into a unique academic group with a current annual programme of more than £180m which includes industrial and in-kind support. From WMG’s inception to the present day, Bhattacharyya has been a passionate advocate for academic engineering, with WMG being a beacon of manufacturing R&D and business education for 34 years.
But what keeps him going?
“What keeps me going?” he asks, laughing to himself. “Seeing a sector grow and to have intellectually challenging problems that you can achieve and attempt to solve. Furthermore if you want to make a success of something then you’ve got to look at the totality, hence, politics comes into it, finance, and having links with law companies.
“I have always been aware that manufacturing or other industry jobs in this country were perceived as second grade careers; I thought it would be interesting to get people in this sector and make it as vibrant as Germany, France or anywhere else in the world. “
Do you think you’re almost there?
“I don’t know but it’s a good start,” he says, laughing again. “I want to train as many people as possible for them to continue this journey. Then we get a critical mass of people and then I have no reason whatsoever to think Britain can’t be a first grade manufacturing nation, because we have all the ingredients to be successful.
Look at South Korea, Taiwan and Japan, where did they come from? They all had problems of natural resources etc. South Korea was nothing 50 years ago, even 20 years ago, but look now. Once you have the right policy, you can do it.”
This may sound all well and good. Optimism is a great quality trait to have. But Bhattacharyya is not seeing the UK manufacturing landscape through rose-tinted spectacles. A lot has yet to be done from a government support standpoint in order to ensure the SME sector can become far more competitive than it already is.
This is crucial, Bhattacharyya says, in sustaining the future of the automotive industry. “The SMEs are not strong enough, that is the reason we virtually don’t have any first tier suppliers in this country. First tier suppliers are the ones who develop the cutting-edge technology.
“Second and third tier suppliers are here, but languish because they don’t have the funding to do the proper R&D. They depend on the host company for the most part. In Europe and other countries the host company gets a lot of R&D done by the suppliers. It’s a win-win situation.
“Unfortunately, if you look at the majority of the companies there is no long termism – there is no investment that takes place and productivity is low. Then you look at very small companies. They have great difficulties in getting funding, even from the banks.
“Hopefully with JLR moving forward there will be new suppliers coming in, especially in the new technologies market, particularly driverless cars, driver assisted cars and the associated software development. No matter how much government assistance comes in, it’s the small companies who have to do it themselves and that is the reason why JLR, as the big company, was very keen on pulling the suppliers.”
It’s easy to see why Bhattacharyya is both optimistic and cautious of the state of play in the UK automotive sector. Throughout his career, he has watched the industry move through a state of rapid innovation in the 1950s and 1960s, with British companies such as Rover focusing on the lightweight potential of aluminium bodies, and Austin driving innovation in small, front-wheel drive cars.
Yet in the late 1960s and early 1970s, as Bhattacharyya puts it, the UK automotive industry “lost its way”. Perhaps it was the massive push from German and Japanese marques, which had access to greater Marshall Aid after the war. These economies focused this kind of funding on their manufacturing economies, while British companies across the country fell into bankruptcy.
So when a company such as Tata decides to put its weight, as significant as it is, behind a struggling company such as JLR, it’s little wonder he took the chance to make the right people meet.
A different story
But it almost wasn’t the success story it now is – or at least it could have potentially read a lot differently if Bhattacharyya hadn’t introduced Ratan Tata to JLR.
There have been whispers since the deal’s inception that JLR was not always destined to fall into Indian hands.
According to different sources, both Russian and Chinese private equity firms were courting the idea of investment. However Bhattacharyya says that if either of these investors had their way, an important part might have been missing from the three most talked about letters in UK manufacturing.
“If the private equity firms took over then Jaguar would have gone,” he says. “And there weren’t any guarantees that Land Rover would have been developed like it has. Most of the private equity companies mentioned the fact that they were not interested in Jaguar, but they had to buy it as a whole.
“I think as far as Britain is concerned, Land Rover is an icon that we need to protect. But in the end, like everything else, if Tata hadn’t come along I don’t believe any other company or private equity could have made it a success.”
But is this investment from Tata going to last? More so the investment in its UK facilities? Recent reports have indicated that Ratan Tata himself is seriously considering moving future production process to either the US or parts of Europe. Austria has been mentioned as a potential site, as have other European nations.
With JLR following in the footsteps of other automakers in showing its desire to focus more on the development of driverless technologies, the scope for further production in the UK is in real fear of becoming less of a reality for the brand.
“I don’t think government is actually bothered, they talk-the- talk but they don’t incentivise the companies. It’s very difficult to compare, but if you look at the incentives that other countries give, it’s much higher, as is the incentive to invest.
“Also you need the market. If you sell it in the US it’s better for them to make there on top of all the subsidies they get. I don’t think the incentive scheme by government for the manufacturing industry is all that great anyway, it’s all talk.”
Despite Bhattacharyya’s ties to the UK Labour Party, he feels this way about all sides of parliament. “Over 30 years we flattened the manufacturing base and there was this perception of manufacturing corporations teaming with unions, and manufacturing companies were exactly like a bank by the city.
“Unless you make money your stock doesn’t go up, and then chief executives incentivise for stock to go up which can only be achieved by cutting this and cutting that, and by the time they finish, the company has disappeared.
“That’s been the ruination of British industry. It’s not that we don’t have any talent or intellectual horsepower, it’s the way we manage and run our companies. It’s all very short term. Unless you can get the money back in two or three years, big investment doesn’t take place.
“We concentrated for the past 30 years on operational efficiency and all that garbage, but nothing on investment and R&D. That’s been the critical factor in the demise of British industry because we concentrated on the wrong things.
“There’s nothing intellectual about operational efficiency, there’s no rigour about it. When you want to sell something, you have to sell a product. If the product itself is not good, no matter how much you improve the efficiency, it’s no use.
“We concentrated on the superficial thing, but in the end it’s the product that sells. No matter what you do, if the product or technology isn’t there, you won’t be able to sell in a competitive environment.”