Jaguar Comes to Halewood - The Story of a Turnaround

By the late 80s, Ford's rather old-fashioned plant at Halewood, England had become infamous throughout Europe for its poor production quality and low productivity. It would have seemed to many a strange choice for its subsiduary, Jaguar, to launch its first volume production of a new "baby" luxury model in 1998. But as the Henry Ford Chaired Professor of Manufacturing Luk Van Wassenhove explains in this award-winning case, Ford's gamble soon proved a winner.

by Luk Van Wassenhove, Ramina Samii

At first glance in 1998, the choice of Ford Motor's Halewood plant may have seemed a strange one for Jaguar's first volume model, the "baby" X-400. The plant in northwest England briefly held the record for number of car factory strikes at the height of British industrial unrest in the late 70s and early 80s. In fact, Halewood had been renowned for fractious management-labour relations for decades. The decision by Ford, Jaguar's parent company, to invest heavily in the Halewood operations surprised no one more than the British unions involved.

However, most Halewood workers had been with Ford - Jaguar's parent company - for decades, and took pride in producing the Ford Escort. (By 1998, it was the sole Ford plant making the model.) But pride aside, Halewood had become notorious for exceptionally poor quality, productivity and competitiveness. Most managers, in accordance with Ford standard practice, were only on 18-month contracts - a rather short period to be held accountable for any major decisions.

Luk Van Wassenhove, the Henry Ford Chaired Professor of Manufacturing, explores the rationale behind Jaguar's decision to opt for an existing facility, rather than a greenfield site -- somewhat going against standard industry practice in the process. The case, winner of the European Foundation for Management Development case competition in 2001, reflects Jaguar's considerable leap of faith in Halewood. This reflected Jaguar senior management's conviction that, with the right strategy, it could engineer enough cultural change not only to make the English factory a model operation, but also to save it from likely imminent closure. With Ford's intention to stop production of the Escort, Halewood's very survival looked doubtful after 2000.

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