Industry Analysis: Chinese Brands To Watch, Part 2 – MG

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– Posted on February 22, 2019

It was perhaps inevitable that the Chinese car companies who would experience the most success wouldn’t look like Chinese car companies at all. The MG brand was scooped up by Nanjing Automotive Group in 2005. Nanjing shortly thereafter merged into SAIC Motor, one of the Chinese Big 4 (the others being Dongfeng, Chang’an and FAW). MG hopes you don’t even realize their corporate parentage, if the heritage logo and Since 1924 signs on their dealerships are anything to go by.

SAIC Motor was wise to buy the MG brand. For their 53 million pounds, they acquired the tooling for the Rover 75 and the Longbridge factory. More important than that, however, they picked up a recognizable brand name. No, MG wasn’t at the top of the sales charts when the MG Rover Group went under but it’s a name steeped in heritage. It helped, too, that the last MG products – the TF roadster, Rover 75-based ZT, and Honda-derived ZR and ZS – were decent cars, if rather dated. The MG name had just enough heritage without having too much baggage.

The Longbridge factory switched to assembly of CKD kits but the vast halls proved excessive for a skeleton staff and it was shuttered in 2016, shortly after the Brexit vote. Since then, all MGs have been manufactured in China, although MG’s design and engineering staff remain predominantly in Birmingham.

The least impressive of their current line-up is, unsurprisingly, their oldest product: the MG 6. Based on a cut-down version of the 1999-vintage Rover 75 platform, it first arrived in Australia in 2013. SAIC used a local distributor and MG completely fizzled out – I recall unsold examples sitting parked by the curbside for a long time. The MG brand was relaunched in 2016, distributed by SAIC themselves. The 6 returned to Australian shores, mostly unchanged.

That was unfortunate. Even more unfortunate was how little it’s changed since then. The interior is a wasteland of hard, cheap-looking plastics. At least the cabin is roomy, owing to the 6’s tweener dimensions. There’s a choice between a five-door liftback and a four-door sedan, which dusted off the Magnette nameplate.

The 6 is a decent steer, thanks to MG’s British engineers, but it’s hampered by a rather unresolved powertrain – the standard 1.8 turbo is a descendant of Rover’s old K-Series four, mated to a dual-clutch automatic. The car is also priced far too close to established compact rivals and, other than offering a tad more trunk space, is hardly worth the risk. China already has a new MG 6, based on the Roewe i6, but it’s anybody’s guess whether it’ll be exported.

Sitting below the 6 (and the Chinese market-only MG 5) is the subcompact MG 3. It’s a cute little thing, dimensionally almost identical to the Ford Fiesta. The 3 nameplate was first used on a resurrected, Chinese-market version of the Rover Streetwise before switching to this model in 2011. It was the first Chinese MG developed entirely in-house, using no MG/Rover platform.

As is desirable in this segment, there’s quite a bit of customization available including optional sticker packs, lurid interior trim, and two-tone paint treatments. The interior is well screwed together and material quality isn’t objectionable for this segment.

The 2018 3’s cabin was looking rather dated so for 2019, there’s a much-improved interior with an 8-inch infotainment screen. You can see the progress MG is making with their interiors and their infotainment system has also earned plaudits for its interface and ease-of-use.

Unfortunately, the 3 is showing its age. Its three-star ANCAP crash rating is underwhelming. The only engine is a milquetoast 1.5 four-cylinder with 109 hp and 111 ft-lbs, mated to a four-speed automatic; surprisingly, there’s no manual 3 here even though this is one of the few segments in Australia where people will still buy a manual. It’s tempting to criticize the MG for only offering four speeds in 2019 but the Kia Rio and Toyota Yaris hatch do the same. The Yaris is also just as old as the MG 3 and less fun-to-drive. Nevertheless, it’s hardly an achievement that MG has merely matched one of Toyota’s lazier offerings.

You may be wondering what’s so great about MG, considering I’ve only discussed an average subcompact and a moribund compact. Well, MG has two other products that have helped drive increased sales volumes in each year for the past few years: the GS and ZS crossovers.

Launched in 2015, the GS was the first crossover to wear the MG badge. Although that may appear sacrilegious to some, MG has sold a wide variety of hatchbacks and sedans in the past so they’re not exclusively a roadster company. Besides, if Lamborghini can sell a crossover, why can’t MG?

Using a SAIC platform, the GS is about an inch shorter than a Ford Escape/Kuga and around an inch wider and yet, in the metal, it looks scarcely bigger than the subcompact ZS. Leaving the doldrums of MG’s car powertrain line-up, the GS offers two turbocharged four-cylinder engines co-developed with General Motors: a 1.5 with 168 hp and 184 ft-lbs and a 2.0 with 217 hp and a stout 258 ft-lbs. The former is front-wheel-drive-only and available with a choice of six-speed manual or a seven-speed dual-clutch automatic, while the 2.0 GS is equipped with all-wheel-drive and a six-speed dual-clutch automatic.

The base GS costs thousands less than segment stalwarts like the Mazda CX-5 but there are some compromises. Critics have said the ride, handling and steering are mostly good but could use some further finessing and the dual-clutch automatic can be dithery. The elegant, Opel-esque cabin is also awash with hard plastics, betraying the GS’ bargain pricing.

Sitting below the GS is the ZS. This subcompact crossover is roughly the size of a Chevrolet/Holden Trax and is powered by the same naturally-aspirated 1.5 as the MG 3, again using a four-speed automatic.

More interesting is the optional turbocharged 1.0 three-pot, producing 109 hp and 118 ft-lbs and mated to a more modern six-speed automatic. Soon, you’ll also be able to purchase (at least in the Chinese market) an all-electric version of the ZS called, naturally, the eZS.

While material quality isn’t at the level of, say, a Mazda CX-3, the ZS has an attractive cabin. It’s also been endowed with a class-competitive ride/handling balance, agreeable exterior styling, and pricing that undercuts key rivals. A seven-year warranty further sweetens the pot.

In China, there’s a third MG crossover called the HS. It’ll arrive in export markets this year, replacing the GS. There will again be a gutsy 2.0 turbo under the hood and superior technology inside, including a 10-inch infotainment screen (up from 8), a 12.3-inch digital gauge cluster, and a delightful novelty as an option: a 64-colour ambient lighting system.

MG has taken criticisms about interior quality to heart if initial impressions are anything to go by.

Amusingly, the HS’ tagline on the Chinese website is in garbled English. “Drive your hormone”, indeed.

SAIC has said Australia is a test market for MG. If the brand can succeed in this small yet extremely saturated market (around 1 million annual sales across over 50 brands), that may embolden them to try larger markets such as the US. They’re already about to enter mainland Europe, buoyed by strong sales growth in the UK. Although they’re no threat yet to the established European brands, they’ve managed to double their sales and market share in the UK in just a few years.

In Australia, MG managed to outsell established brands like Peugeot and Fiat last year. In the first month of this year, as CarAdvice reported, MG even managed to topple Jeep, Mini and Skoda. Better yet, the MG brand is seeing rapid growth in China. Sales increased by almost 70% in 2017 and then more than doubled in 2018, enough to become one of the 25 best-selling brands in the sprawling Chinese market. That puts it in striking distance of Ford’s ailing Chinese operations and above brands like Mazda and Mitsubishi.

MG won’t just become a crossover-only brand, even if those vehicles are powering the brand’s growth. MG is reportedly working on an all-wheel-drive electric roadster to rival the Mazda MX-5. Additionally, they may develop a production version of the sublime e-Motion concept car. Such a vehicle would provide them with a Tesla rival while also remaining true to the brand’s sporting heritage.

MG will likely continue to expand their global presence. Their products may trail rivals in some aspects but they’re promising efforts. With the GS and ZS, they’re focussing on products in key segments and they’ve quickly grown market share. We’ll have to wait and see if they can sustain it.

Related Reading:

Industry Analysis: Chinese Brands To Watch, Part 1 – LDV

Curbside Classic: 2002 MG ZS120 – Lessons Are Not Always Learnt

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