Phase three – 1981-1986: Free at last. Jaguar’s independence becomes a reality as Sir William takes a more active role.
When John Egan made contact with Sir William Lyons in 1981 to sound out the Jaguar founder for the role of company President, he was taken aback by his response. ‘I already am, lad!’, Lyons informed him. Amid the turmoil of the previous eight years everyone appeared to have forgotten. Lyons warmly embraced the new incumbent, believing the Lancastrian was the man to reconstruct Jaguar after the disastrous Ryder years. The two men quickly developed a rapport and Egan became a regular visitor to his Wappenbury Hall home where he would take advice from Jaguar’s venerable founder.
Once Jaguar became independent, he became a regular visitor to Browns Lane, casting a still-astute eye over styling studies for forthcoming models. Lyons contributed to the detail styling of both XJ40 and the stillborn XJ41 (F-Type). By now elderly and quite frail, but in business and stylistic terms, Lyons remained as sharp as a tack.
Meanwhile, Egan never lost an opportunity to tell the press that nothing short of full independence would do, later asserting that without it, Jaguar ‘would have sunk without trace’. Fortunately, his ambitions neatly dovetailed with a Conservative government ideologically committed to removing the massive drain the nationalised BL had become upon public finances. Prior to this they had been thwarted by the formidable arguments of BL’s Sir Michael Edwardes, but with Ray Horrocks now in place, and Jaguar’s miraculous turn-around grabbing the headlines, the Coventry cat’s future rapidly became the subject of feverish speculation.
Egan worried that Horrocks would grab Jaguar’s hard-earned profits to prop-up his ailing volume car division, as BL had done in the past. This was in fact what opposition MPs argued should take place – debates in both houses of parliament illustrating bitter divisions over the planned floatation. Horrocks tried a different tack, convincing the Department of Trade and Industry that BL should be allowed to retain a 25% stake in Jaguar. But following a fractious cabinet debate over the affair, Secretary of State Norman Tebbit was overruled by Mrs. Thatcher who recognised the political kudos in Jaguar’s complete severance.
The deal was a poor one for Horrocks, since BL had invested over £150m in Jaguar from 1979 to ’81, but it could be argued it was justice for a decade of chronic neglect and interference. The summer of 1984 saw Jaguar prepared for floatation on the UK stock market. The work involved was forensic, their accounts having to be recreated from BL’s balance sheet. The work of disentangling the Jaguar business took months of fevered legal and accountancy work. Once free, Jaguar found they were saving money in virtually every area, largely because BL had become such an inefficient business.
The agreement was that Jaguar would have six years of government protection before having to stand or fall on its share value. This would take the form of a Golden Share retained by the Secretary of State. John Egan’s love-in with the conservative government meanwhile came to its peak that year with a Knighthood.
Jaguar’s new knight-gaffer didn’t lose sight of commercial realities however, demonstrating fiscal prudence. Central to his plans was the ability to invest and play the money markets. It’s worth pointing out Egan was fortunate in that the turnaround coincided with a global spending spree. Luxury car sales boomed on the back of market highs – particularly in the US. Had this not occurred, Jaguar’s position would have remained a good deal weaker.
For Sir William, privatisation was the best possible outcome and those close to him confirmed his delight that the company he founded was once again in private hands. However, his health was rapidly failing and in February 1985, this enigmatic genius passed away. Jaguar lost more than their spiritual leader in Lyons’ passing. Something more intangible was also irrevocably gone. Jaguar’s DNA perhaps?