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A recent interview with Nikolai Smolenski that made it's way onto the pages of The Sun newspaper.
The SunFrom Russia with hope
By KEN GIBSON
Motoring Editor
At 24, Nikolai Smolenski became the world’s youngest owner of a car firm when he bought TVR for £15million.
His fortune came from his father, a Boris Yeltsin-era oligarch, who had made his millions in publishing, housing and banking.
Nikolai started out running his father’s First OVK bank group at the age of just 23, when he was in charge of 12,000 workers. He had plans to triple the bank’s size but it was sold a few months later for £80million.
The following year Nikolai, a sports car fan, turned to TVR, saying “I have invested a very considerable amount of money in TVR because it represents all that’s best in British engineering and ingenuity. I really want to see what it can do with extra resources.”
But after two years under control, TVR – the wild child of the British car industry – now has a question mark over its future.
This week, Sun Motors talked exclusively to Nikolai to find the answers.
HE’S the 26-year-old Russian rouble billionaire with the fate of classic sports car firm TVR in his hands.
TVR have been shrouded in a cloak of mystery since Nikolai Smolenski stunned the motoring world by buying the firm for 22million in 2004.
Smolenski announced his ownership in bizarre fashion when he walked into a London TVR dealership, bought a TVR T350 Targa, then told the owner Giles Cooper: “I’m buying TVR tomorrow.”
Cooper responded: “You and everyone else” to which Smolenski replied: “Come with me if you don’t believe me.”
The next morning Cooper got a phone call from TVR boss Peter Wheeler, who told him: “I believe you met the new owner last night.”
It was the start of a rollercoaster ride for Britain’s most flamboyant car firm.
TVR have been in the news constantly, but often for the wrong reasons.
In recent months, fears for the firm’s future hit crisis point as sales slumped, TVR laid off 71 workers and announced plans to move from their Blackpool base.
The rumour mill — starved of official information — has been rife.
Some say young Smolenski has become bored with TVR, while others reckon he will move production abroad, possibly to Russia.
Only one man knows the facts — Nikolai Smolenski. And this week he gave his first ever in-depth interview exclusively to The Sun.
The first thing that strikes you about Smolenski is how young he looks — despite being a father of one.
The second is his single-mindedness and determination to defy his critics and make a success of TVR, but only on his terms.
For a man who has been pilloried for not talking to the media, he is refreshingly open about his plans.
He answers my first question about where TVR will be built without hesitation — TVR WILL be staying in Blackpool.
Smolenski tells me he is committed to the town and will finalise a deal with Blackpool Council to move to a new site in August.
However, a separate new corporate headquarters which will also house the firm’s research and development department will be situated on another site close by.
The site at Squire’s Gate, which will be able to produce up to 1,000 cars a year, is likely to be an interim home, with Smolenski’s long-term aim to move into a purpose-built factory that could eventually make up to 5,000 cars a year.
But the new sites were only agreed after he walked out of the meeting with the council and rejected their first offer.
His walkout underlined his volatile nature, but also his ability to get his own way. Smolenski is keen to explain why he wants to move — because the estimated 732,000-a-year lease on the current factory is too expensive.
He says: “We are only using less than half of the site, which is old and outdated.” Asked whether he considered moving the company from the UK or away from Blackpool, he says: “We have 320 highly skilled workers in Blackpool who have been trained up over many years.
“I did look at other sites in the Midlands and the South East, but neither had the skill levels we have here.”
He believes the new factory will allow TVR to become more efficient and that by 2008 they could be building up to 1,000 cars a year.
And he underlines his commitment to his workers when he adds: “The TVR workforce are highly talented and crucial.
“We don’t have anyone but the workers — they are the company.”
But he makes it clear that the future of 71 workers currently laid off is dependent on TVR hitting production levels of around 500 cars next year.
He says: “Our aim is not to make anyone redundant, but our 320-strong workforce was geared to hitting production figures of 500 cars.”
Sales this year have dropped because of the uncertainty over the future and poor weather, which affects all sports car sales, and production has slumped to an average of ten cars a week. In his short time at TVR, Smolenski has shown that he has a ruthless streak and will take tough decisions.
This has seen him hire and fire senior sports car specialists brought in to help him run the firm, as well as established staff who failed to agree with his plans.
He also clearly resents the arrival of an official trade union at the factory, which replaced the previous workers’ council. Relations have clearly cooled from the early months when he had regular weekly meetings with his works committee.
Smolenski says: “Of course it upsets me that there is now someone between me and my workforce.
“I don’t mind them having a trade union, but I can’t accept people from outside coming in without a clue, who start making demands.”
Asked if he accepts that his age has been a barrier, Smolenski replies: “I think age and experience matter.
“I’d be better if I had 25 years in the motor industry, but maybe if I had I would not have attempted buying TVR! But my age is not working against me.
“It does not mean I am less capable of making this company a success. I don’t drink or smoke and I have lots of energy, but I do want experience around me.”
His claim is underlined by the fact that he recently re-hired Nigel Gordon-Stewart, a former Lamborghini and Lotus executive and one of the most experienced operators in the UK sports car business — and one of the people he earlier sacked.
However, he makes it plain that, as the owner who has invested up to 40million in the firm, he will make the key decisions.
He says: “If I am paying the bills I need to know what is going on. I am not a control freak. I allow people to make decisions, but I reserve the right to make the final decisions after people have reported to me.” Asked if he has made mistakes, Smolenski replies: “We all have good days and bad days.” But he believes he has brought better organisation and structure to TVR and made considerable improvements in the crucial areas of quality and reliability.
Certainly, motoring journalists, including myself, agree that the latest TVR models provide the best quality ever while retaining their outrageous performance and unique styling.
Smolenski plans to replace the outdated production operation in the current premises, where cars are pushed around on trolleys from workstation to workstation, with a more efficient system in the new factory.
For years TVR have been known as much for their poor reliability as their exotic and powerful sports cars.
But Smolenski says: “We haven’t had to rebuild an engine under warranty in four months. Now we have real quality control.”
He has also invested heavily in a research and development team that is 40 strong. They are developing the TVRs of the future and striving towards further improvements.
Smolenski is also working hard to grow the firm’s dealer network, especially in Europe which he sees as crucial to expanding TVR. New dealers are also planned in South Africa, the Middle East and Asia.
And, contrary to popular opinion, he does not see his native Russia as a key market, but believes Germany, followed by Italy and Spain, offer the greatest potential alongside the UK.
He has a clear vision of the future. He says: “My aim is to produce more cars. The new factory can cope with up to 1,000 cars a year, and if we feel we can grow further in a few years — possibly up to 5,000 cars — we will relocate within the area.”
By 2008 he would like to be in a position to tackle the lucrative American market, which he “can’t ignore”.
Smolenski says he wants to expand the TVR range, but his immediate plan is to continue producing the Sagaris and Tuscan models.
The future of the Cerbera will depend on finding a new V8 engine.
And he does hint that, since next year is TVR’s 60th anniversary, he and his team are working on “something special”.
I expect to see at least one and possibly two new models unveiled at next year’s Geneva Motor Show.
Everything, however, will depend on the move to new premises going smoothly after the summer break in August.
He expects it to take between four and six weeks.
Smolenski knows TVR need to get back to making cars, and in serious numbers, very soon if the firm is to have a real future.
TVR has had major problems but the brand is definitely well worth saving. Yet the fate of MG Rover is a clear reminder that nobody has a divine right to stay in business. Smolenski remains determined to turn things round. He says: “I am more passionate about TVR now than when I bought it. I have never thought about walking away. I am confident about the future and have no intention of losing my money.”
Time will tell whether his plans and confidence will prove to be well founded.
Let’s hope they are — for the sake of a great car company and more than 300 workers whose livelihoods depend on it.
But there remains an air of uncertainty and unpredictability about TVR under Smolenski that leaves you thinking anything could happen.
