Morgan Motor Company - The Car Maker's Journey into the 21st Century

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Case Details:

Case Code : BSTR201
Case Length : 16 Pages
Pages Period : 1910-2005
Organization : Morgan Motor Company
Pub Date : 2006
Teaching Note :Not Available
Countries : United Kingdom
Themes :Family-Owned Business | Business Environment
Industry : Auto and Ancillaries

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"From a Harvard Business School point of view, the company (Morgan) has done almost nothing right... It has for the most part failed to automate or expand, failed to diversify, failed to change its product line, failed to turn to the stock market for new capital... It has, in short failed to do everything but succeed."

- An extract from an Esquire magazine article, quoted by BBC in 2001.1

"Other cars are built to price. Ours are built to last."

- Charles Morgan, Managing Director of Morgan Motor Company in 2003.2

Morgan Announces 'Eco Car' Project

In mid-2005, Morgan Motor Company (Morgan), a British car manufacturer which had stuck to old fashioned hand crafted cars, announced that it was to start developing what it called the 'world's first environmentally friendly sports car'.

Morgan produced a range of sports cars. The new car, labeled 'LIFEcar,' was to be modeled on Morgan's successful Aero 8 sports car that was launched in 2000, but it would incorporate a fuel cell instead of the BMW V8 engine used in the Aero 8. The fuel cell would use hydrogen stored in a tank and draw air from the atmosphere to create electricity. This would be used to power the car's four motors (one for each wheel). The only emission the car produced would be water vapor. The car was also to have an ultra quiet engine - a departure from Morgan's traditional 'throaty' engine sounds. Motor experts were initially skeptical about the efficacy of using fuel cells in a sports car. Fuel cells had certain drawbacks.

They were capable of delivering high top speeds, but they did not generate the surges of power required for rapid acceleration. Morgan planned to overcome this shortcoming by using powerful capacitors (devices which store electricity and then release it rapidly).

These capacitors were to store energy generated from 'regenerative braking'3 to supplement the electrical supply during acceleration. The use of capacitors would also allow the LIFEcar to have a smaller than average fuel cell, thus making it lighter and improving its speed. A consortium of universities and engineering firms worked together with Morgan on the LIFEcar project. Qinetiq, a former British government defense research agency, was to develop the fuel cell for the car, and the BOC Group,4 an industrial gas company, was to produce the hydrogen refueling plant. The project was funded partly by the British government and partly by private sources. The British Department of Trade and Industry made a grant of ₤1.9 million5 towards the LIFEcar project.

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2] Kate Noble, "Driving Back to the Future," Time Europe, Summer 2003 Special Edition.

3] A regenerative brake is an apparatus, a device or system which allows a vehicle to recapture and store part of the kinetic energy that would otherwise be 'lost' to heat when braking. Regenerative brakes are commonly found in electric or hybrid vehicles (Source:

4] The BOC Group was among the world's Top 3 producers of industrial and specialty gases, along with Linde and Air Liquide in the early 2000s. BOC's operations include the manufacture and distribution of gases and the installation of plants that produced nitrogen, argon, and other gases used to make industrial metals and other products.

5] Dollar conversion app $3.7 million.


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