Down Longwall Street in Oxford is what was, on its opening in 1911, known as the Morris Garage, the original site of the car business of the same name.

Now student accommodation, the premises were built by William Morris, a local bicycle seller and repairer turned motor-car agent, assembler and, ultimately, manufacturer. Frustrated by the supply of foreign-supplied parts from which he built his cars, he expanded slowly to build everything in-house, what would now be termed vertical integration. And so was started a great line of cars that included the Morris Minor, Mini and Oxford, the latter which only stopped its 50-year production run (as the seemingly indestructible Hindustan Ambassador) in 2014.

Worlds and Centuries apart: Morris Garage The 1911 Version

Along the way William Morris, later Lord Nuffield, bought up Wolseley and Riley before, in 1952, Morris itself was amalgamated with Austin to form the British Motor Corporation. In 1968 it folded into British Leyland which was effectively nationalised in 1975. By the mid-1980s many of the once dominant marques including Riley, Triumph, Wolseley, Alvis, had collapsed or disappeared.

The last car badged “Morris”, the dreadful Ital, came off the line in 1984.

It was, at the end, a sad story of bad management, over-zealous unions, a failure to innovate, and claustrophobic government policy. While enveloping state interventions might grow the government’s role and influence in the economy, in the British case this proved both very expensive and very inefficient, costing the public to the benefit of the few who had jobs and the power of the politicians and officials who gave these to them. It is tough even for entrepreneurial lions to succeed when led by small-minded bureaucrats. They fail because they, as facilitators, don’t usually understand entrepreneurship and capitalism, and its drug of risk and reward.

What this painful era taught the UK is that policies that push people into a competitive market – not shield them from it – is usually best for them and the economy. And so the pendulum swung firmly to the other extreme under Margaret Thatcher, who said the best industrial policy was not to have one at all.

While the spectre of state intervention remains, threatening to add to the junkyard of failed industrial projects, there are other, fresh challenges to confront.

The fourth industrial revolution could, if the dire predictions prove correct, cost up to a third of current British manufacturing jobs in the next 20 years, and perhaps as many as half of those in the US. Employment of the poor and most vulnerable in both developed and developing worlds is apparently in greatest danger of being displaced by robots.

At the same time, income inequality in the developed world has reached levels not seen since the Great Depression. In the three decades following the end of the World War ll, for example, hourly wages of the average US worker rose 91%, in line with productivity growth of 97%. Yet from 1973 until 2013, hourly compensation of a typical worker rose just 9% against a productivity rise of 74%. In part this is down to an increase in outsourcing to cheaper labour markets. A related increase in the size of the domestic labour pool has also pushed down wages.

If losing your job is not enough, this era has also seen wealth among the elite skyrocket. The median salaries paid to the CEOs of Fortune 500 companies trebled to over $10 million between 1992 and 2013, their pay increasing from 20 times the average worker in 1965 to 300 times today.

The ensuing disquiet is what Donald Trump tapped into, though his voters included those who had benefited from the cheaper goods produced by outsourcing, and even though, irony on irony, he is a billionaire.

And while we focus on the losers in manufacturing, many others have prospered. The combination of trade, technology and liberalisation has especially empowered East Asia. This has led to a radical reduction in extreme poverty, from half of the global population in the 1960s to under 10% today. Asia makes almost half of the world’s goods, today led by China, which in 1990 produced less than 3% of worldwide manufacturing output by value.

Now China’s global share of manufactured goods is nearly one-quarter.

Moreover, this is not the first time in which manufacturing has faced challenges of technology. The ability of business to survive as an automator rather than being automated will, as before, hinge on the manner of the entrepreneurial response.

Still, it would take a brave person to attempt to break into the automotive sector, especially now, when capital intensity and robotics rather than perspiration would seem to matter most.

Enter Lawrence Tomlinson.

Yorkshire lad Tomlinson started in business importing ski boats and classic cars. Having bought out his parents’ care (old age) home, his business interested moved into the design, build and operation of new care facilities. Over the past 25 years LNT Construction has built around one-quarter of all new UK care homes.

Photo: The Ginetta Factory today. Photo: Greg Mills

A self-confessed serial entrepreneur, he since launched LNT Software and LNT Solutions, a chemical company which supplies the necessary muti to stop trains slipping on the tracks, and de-ices aircraft surfaces.

Then, in 2005, Tomlinson acquired Ginetta. A manufacturer of racing and sports cars since 1958, Tomlinson has turned it from a failed business into a major force in international endurance motorsport, producing 100 hand-built cars a year. In 2018, Ginetta will be at the Le Mans 24-hour, competing in the top class alongside the likes of Toyota and Porsche.

From the LNT Group’s purpose-built site in Garforth outside Leeds, Tomlinson, 52, does not mince his words on how Britain, among others, should get ahead, notably in the automotive sector.

“Car manufacturing is a particularly difficult space to be in,” he reflects. “The odds are stacked against you by the big manufacturers through legislation and the prohibitive costs of homologating any design to enable large-scale productions.” He cites the costs of licensing a headlamp cluster, for example, at “more than £1-million”.

“Mr Morris,” he laughs, casual in jeans, T-shirt and paddock jacket, “would not have had a cat-in-hell’s chance of making it today. He would be regulated right out of it.” That is not the only challenge. “We require patient capital, of which there is none. The banks don’t want to lend you money for such long-term investments, and private equity investors want to double their money and get out in three years.”

Photo: Complex engineering, though no flux capacitors in sight: Ginettas under production. Photo: Greg Mills

For these financial reasons alone he thinks that “we won’t see another Ginetta” .

Regardless, with the passion to commit his own such “patient capital”, he has followed a careful plan since taking over the company. “The original idea was that we would turn a profit by 2015. But we could not forecast the (2008) banking crisis which set us back four to five years”.

With the Le Mans entry imminent, and a new sports-car for the road on the drawing board, Tomlinson believes that Ginetta will be in the black by 2020.

His plan has played to the company’s strengths. Rather than going for mass production, Ginetta has used its small production runs to its advantage, being flexible enough to cancel one road-car prototype and come up with distinct designs. “We don’t produce shite Euroboxes like the big manufacturers,” he states, emphasising his northern vowels. “I defy anyone to tell the difference between an Audi, Tesla or Ford beyond the grills and the badge, this uniformity again partly a product of regulations.”

Photo: Starting small, but with a 10-year plan to triple production, including a new sports-car and Le Mans entry. Photo: Greg Mills

As a result, the European Union will, he argues, “ultimately be a race to the bottom of competitiveness. We have created a whole industry of Eurocrats, ensuring that while we are competitive in our own closed market, we are slipping behind the rest of the world”.

This is the main reason why he supported Brexit, not because of parochialism, but to the contrary for reasons of increasing integration with the world. “We should be opening ourselves up as a destination of choice not just to Europeans, but to the best of talent in the rest of the world, including those from South Africa, India, and elsewhere in the Commonwealth.”

Still, there are, he admits, things that government can do to help manufacturing other than his overall preference for them “just staying out of the way”.

He cites Ginetta’s experience in building an electric car prototype in 2009.

“Although the battery technology was very basic, we built a car with a 200 mile range. Since then Tesla, which was well behind us at the time, has received nearly $500-million in cheap government loans, and Fisker another $500-million.” These payments were made under the American government’s “Advanced Vehicle Manufacturing” programme, which additionally saw Ford receive $5.9-billion and Nissan a further $1.45-billion.

“We applied for a government grant to develop the electric car, to do 10 prototypes to get European-type approval. Despite having small teams of people creating mountains of paperwork, we were turned down. Instead they gave Ford £10-million.

“Even though we had a working model, we cannot compete against Tesla with their level of government support.”

The total value of the incentives and US government loans to Tesla is reportedly now over $2.3-billion.

“We would scarcely have been able to spend £50-million on the prototypes,” Tomlinson says. “Yet if we had got the money, I had committed not to taking a penny out of the business, would have paid them back, would have created jobs, apprenticeships and spend research money at the universities. It would have been real life,” he emphasises, “making and developing things. We could have been like Tesla, but in Britain, creating thousands of jobs.

“But this is exactly why we are do good at inventing things in the UK but not in taking it to the next level. We lack the balls, and the patient capital ….”. Instead Ginetta moved back to developing its road and track models, since dominating various international endurance racing categories.

He cites the controversial DeLorean episode as how to get such support wrong. The UK’s Labour government, desperate for a success, funded 60% of the start-up costs of the Northern Ireland factory of the DeLorean DMC12, a car made famous by the Back to the Future trilogy. DMC went bankrupt in just four years in 1982, costing 2,500 jobs and over $100-million in investment.

Photo: Ginetta, Ahead of the Field. Photo: Jakob Ebrey Photography

Ginetta is an industrial enigma. It inhabits a high-tech world on a small enough scale and esoteric enough that the jobs require the type of specialist skills which protects many of them from automation. It relies on self-financed, patient capital, but could do more with financing from elsewhere.

Its success has been underpinned by sound engineering and business logic, of continuous evolution rather than revolution. Tomlinson’s personal mantra is “don’t wait for the big idea to come. Do something today, and every day, that will take you nearer your goal”. Modestly he does not refer to the need for a hands-on, driven individual entrepreneur, as he indubitably is, pushing all the time, concerned about attention to detail. When I met him he had just returned from testing a car in Dubai, unhappy over even the smallest type of failures which one expects of high-performance engineering.

The same was true for William Morris. The can-do attitude which took him from bicycle repairman to global car icon, was helped by freedom of regulations, but required a smart, driven personality. Contrastingly, Morris disappeared amidst the stultifying stasis of statism. As productivity fell, and innovation was replaced by ideology, great chunks of British industry slipped into reverse, decline and ultimate collapse.

Not one single attribute is required to ensure industrial success, today as before. The advent of new technology will make it more difficult, and certainly more complex. But no futuristic Back to the Future flux capacitors or continuum transfunctioners are essential for this new era. Adroit management, engineering talent and technology are as important today as they were for Mr Morris, and their assiduous integration even more so.

Governments could do more, in part by attempting less. They could help more through research grants and by structuring more patient capital.

But nothing will happen without the entrepreneur, those willing to take risk for reward. Smart, motivated, competitive people, intent on leaving a legacy and able to work around obdurate regulations, as Lawrence Tomlinson personifies, still make the difference. DM

Dr Greg Mills heads the Johannesburg-based Brenthurst Foundation, and is the co-author of the forthcoming Making Africa Work: A Handbook for Economic Success. He interviewed Tomlinson in Garforth in Leeds

Photo: Lawrence Tomlinson talking to the author in Garforth, Leeds. Photo: Greg Mills