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A HISTORY OF VOLKSWAGEN IN THE UNITED KINGDOM
SUMMARY
Volkswagen celebrated 60 years of trading in the UK in 2013. However the
company’s relationship with the UK dates back to 1952, when the first two Beetles
were sold. In 1953 Volkswagen Motors Ltd became the official UK importer. The
Passat arrived in 1973, the Golf and Scirocco were imported in 1974 while the last
Beetle built in Europe arrived in the UK in 1978. In the same year, Volkswagen
centralised its operations and moved into its new £9.5 million headquarters in
Blakelands, Milton Keynes. From Blakelands the company controls sourcing,
marketing and distribution of all vehicles and parts for Volkswagen Group brands
(Volkswagen Passenger Cars and Commercial Vehicles, Audi, SEAT and Škoda) in
the UK and provides a host of support services to both its retailers and customers.
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VOLKSWAGEN Group United Kingdom Limited is a wholly owned member company
of the Volkswagen Group and the sole importer of Volkswagen, Audi, SEAT and
Škoda cars, and Volkswagen Commercial Vehicles into the United Kingdom.
The history of the British importing company goes back to 1953 when an Irishman,
Stephen O’Flaherty, was granted the franchise to sell Volkswagen Beetles in this
country. He founded Volkswagen Motors Limited from a small office in London’s
West End with a share capital of £25,000.
By the mid sixties the company was established as one of the leading importers of
cars, a position still held today. In 1986 120,285 vehicles were sold, including
109,237 cars and 11,048 commercial vehicles. Very few people in 1953 would have
envisaged that kind of success story for Volkswagen in Britain. It seemed then to
many pundits that Stephen O’Flaherty had taken on an impossible, if not a foolhardy
proposition.
The Beetle had been described by a British motor industry commission who visited
the Volkswagen factory in Wolfsburg soon after the war as ‘bizarre, noisy, too
flimsy…a toy not to be taken seriously…a type of car like this will remain popular for
two or three years, if that.’
Stephen O’Flaherty’s first task as concessionaire was to find distributors. He
gleaned them from the dealers anxious to add new lines to their depleted stocks and
from others left at a loose end by the failure of the Jowett Company. And he
prospered. Sales of the odd little car rose from 945 in 1953 to 5,381 in 1956.
By 1957 it was clear that a major infusion of capital was necessary if the Volkswagen
organisation was to expand here and Thomas Tilling acquired the concession.
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Volkswagen Press and Public Relations
Volkswagen (UK)
Yeomans Drive
Blakelands
Milton Keynes MK14 5AN
Telephone 01908 601187
www.volkswagenpressoffice.co.uk
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Press Information
-2Mr James J Graydon, general manager of Henley Motors, was appointed managing
director with the brief to build Volkswagen Motors into one of the largest importers of
foreign cars into Britain. He had accomplished that comfortably by the time of his
retirement in January, 1968.
It was then that Mr Alan M Dix, who ran one of the largest distributorships in the
United States, was appointed managing director and given a free hand to reorganise
the entire Volkswagen structure in Britain. The motor trade in Britain was entering a
more sharply competitive era. A major reconstruction of the Volkswagen dealer
network was required.
He phased out the 27 middlemen distributors and created instead a single tier
structure with the importers distributing direct to retail dealers so that proper control
over standards could be exercised in the best interests of the customer, the
manufacturer, the importers and the dealers alike.
Distribution direct to dealers by the re-named Volkswagen (GB) Ltd brought enviably
high standards to the Volkswagen dealer network in the UK. Modern warehouses
were built at Towbridge, Doncaster, Whitburn, Edenbridge and Ramsgate for the
distribution of parts throughout the country.
Sales of Volkswagens in Britain rose from 29,000 in 1967 to 54,000 in 1981. When
Alan Dix left the company in March 1972 it was by far the largest vehicle importer in
the country. Douglas Miller took over as managing director in April 1972.
Meanwhile the Audi franchise in Britain had been developing quite independently
although also under the ownership of Thomas Tilling Limited.
They had acquired the Audi half of the franchise in 1958 from AFN of Isleworth when
the only product was the two-stroke DKW car. Thomas Tilling set up Auto Union
(GB) Limited through the Mercedes (GB) company which they also owned.
The first real progress in the UK market came when the Audi 100 was introduced in
1968. By that time the controlling interest in Auto Union in Germany had passed
from Mercedes to Volkswagen.
Sales progressed to 4,500 in 1971 when Thomas Tilling Limited acquired NSU (GB)
from the Layford Trading Company and formed Audi NSU (GB) Limited.
In early 1972 John Wagner was appointed managing director with the brief to
increase sales rapidly. In his first year at the head of the company sales were more
than doubled to 11,300 cars and in the following year nearly doubled again to 20,000
cars.
In 1973, Thomas Tilling carried out a major reorganisation of Volkswagen (GB)
Limited and Audi NSU (GB), merging the two companies and appointing John
Wagner as managing director.
The next two years were among the most significant in the history of the company.
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-3The manufacturer introduced an entire new range of water-cooled, front-wheel drive
vehicles designed to take Volkswagen away from its one model dependence.
In 1974 the still separate networks of dealers handling Audi and those handling
Volkswagen were merged in a mammoth exercise involving retraining dealership
staff and large scale investment in new equipment and premises.
In the following year Lonrho Plc purchased the entire share capital of Volkswagen
(GB) Limited from Thomas Tilling. Under the leadership of Michael Heelas and the
expansionist new owners, the Company made its largest ever investment in 1978. A
£7.5 million headquarters complex in the new city of Milton Keynes,
Buckinghamshire was completed in September of that year. With an additional £2
million invested in 1980 to enlarge the parts warehouse, and a further £1.6 million
extension completed in 1984, the complex included an eight and a half acre
warehouse, a training school, a computer complex and administration offices to
house the headquarters’ staff of 650.
In 1982 an 80 per cent shareholding and control of the company was won by V.A.G
(United Kingdom) Limited and that remained the position until January 1992 when
MAN Nutzfarhzeuge took control of MAN activities in the UK. They retained the staff
and headquarters at Swindon, with the Volkswagen Commercial Vehicle activity
moving to Milton Keynes.
In October 1980 the Volkswagen and Audi organisation in Britain changed its name
to V.A.G (United Kingdom) Limited, a move that was followed up in other countries,
using the term of V.A.G to convey the services being offered by the Volkswagen and
Audi organisation.
On 1 January 1993 Lonrho sold its entire shareholding to the Volkswagen Group,
making V.A.G (United Kingdom) Limited a wholly owned subsidiary.
On 1 January 1995 SEAT (United Kingdom) Limited and Skoda Automobile United
Kingdom Limited became part of V.A.G (United Kingdom) Limited.
It was therefore appropriate that a change in name be made and on 3 November
1995 the Company’s title became ‘Volkswagen Group United Kingdom Limited’.
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UK history / KT 0310