Cult carmaker Morgan defies the gloom

Morgan Motor Company, the centenarian British car manufacturer, has defied the difficulties of the global automobile industry with record sales of its cult sporty convertibles.

Full-year pre-tax profit trebled to £661,209 on turnover of £26.8m, up from £22.1m 12 months earlier, according to results just filed at Companies House.

Turnover, 60 per cent of which comes from exports, is expected to hit a new high of £28.6m for the current year.

Morgan’s fortunes are not just a reflection of the lasting popularity of its cars among retired business executives and anglophiles.

Unlike its larger peers, Morgan only makes cars that people have ordered, pre-selling build slots and taking sizeable deposits to secure commitment from customers.

For those buying a Morgan, this means a wait up of to a year for their set of wheels, but the business model has protected Morgan from the risk of masses of unsold stock that have become the bane of its much larger peers.

It is a point not missed by Charles Morgan, managing director and grandson of the company’s founder.

“Our approach might not be fashionable, but we don’t have a situation like some of the other companies in our industry where they have a workforce twice as big as they want,” he says. “We have never gone for volume.”

Morgan is planning to add a couple of extra positions to the 165-person workforce at its factory in the idyllic surroundings of the Malvern Hills. This will help the company raise production to a new high of 850 cars a year.

Little seems to have changed on the production line since the company first started making cars there in 1909, with chassis still assembled on wooden blocks and moved by hand around the building.

However, Mr Morgan notes that the method of production is not what slows down delivery.

“A lot of the things you put into a luxury car have a three- or five-month order time,” he says. “If it takes us longer than a year to complete a vehicle, however, we are deeply efficient.”

The one thing Morgan orders in advance is its engines from BMW. And it is under the bonnet that Morgan has strived to match the best in the world.

Each Morgan is also fitted with the latest generation ABS braking system, providing stopping times that are better than a Ferrari, according to Bosch, its supplier.

Morgan also collaborates with a number of UK universities and is one of the most successful beneficiaries of the government’s Knowledge Transfer Partnership, aimed at linking academic innovation with industry.

Its AeroMax and SuperSports lines are the world’s first super-formed aluminium cars, making them at least 20 per cent lighter than their rivals.

“With the AeroMax we have started to attract a completely different sort of customer,” Mr Morgan says.

“We are still selling the little four-door £26,500 sports car to the guy who has just retired and always promised himself a Morgan, but we are also finding people who want a second car down at the villa in France.”

Morgan plans to build on its success with an electric car, whose on-board power generation provides a range of 1,000 miles, due for launch in 2012.

It has also started taking orders for its EvaGT, a four-seater sports saloon that was shown for the first time at the Pebble Beach Concours d’Elégance in California this month.

“What we aim to do is to produce a traditional British sports car without the unreliability,” Mr Morgan says. His business also looks unlikely to run out of road any time soon.