Press Report : Jaguar bail-out must come ‘in days not weeks’ warns union
Nick Allen and Rupert Neate, Daily Telegraph, 22nd December, 2008
Union leaders are making last ditch pleas to Gordon Brown to help bail out Tata-owned car giant Jaguar Land Rover and safeguard tens of thousands of jobs. They said the Government has “days not weeks” to save the carmaker.
Its Indian owner Tata has confirmed it is pumping in millions of pounds of emergency funding to avert a liquidity crisis. The Government had said it would not provide the company with state aid until it was satisfied that Tata had done all they could to help.
Unions are now stepping up pressure on the Government to offer some form of aid. Officials from Unite were involved in behind-the-scenes moves aimed at drawing up a package of support for Jaguar and other manufacturers facing heavy losses as the UK heads for a recession. A union source said: “There will be top level discussions going on throughout the next few days to try to get a deal agreed, even if the details are not announced until the New Year.”
Business Secretary Lord Mandelson has been making it clear over the past week that the Government was looking to Tata to take action to help its British firm. The minister said the Government did not have an “open cheque book” to help private companies facing problems because of the credit crunch. He played down the prospect of a quick bail-out for the British car industry despite pleas from the Society of Motor Manufacturers and Traders for help.
The Government is facing calls to follow the lead set by President George Bush, who last week agreed to lend $17.4bn (£11.6bn) over three months to keep Chrysler and General Motors afloat. Labour peer Lord Bhattacharyya had suggested ministers were discussing a £667m loan package for Jaguar. But Lord Mandelson said: “The Government cannot be a first call for help in these circumstances. The owners have to look to themselves and their own resources. If there is anything that the Government can appropriately do for any such company then it will have to meet – and pass – some pretty tough tests.”
Car factories across the UK, including those run by Jaguar Land Rover, are closed for an extended Christmas shut-down but financial pressure on motor firms is growing. Unions have warned that tens of thousands of jobs are at risk in factories across the UK unless the Government takes action.
Jaguar Land Rover employs 15,000 in the Midlands and Merseyside and tens of thousands more jobs are dependent upon its supply chain. A Tata spokesman said: “The company is resolved to do all it can to help all its businesses. The entire world has gone into a downturn; these are extraordinary times.” He said that it was “difficult to quantify” how much money the company has pumped in to Jaguar but it is understood to be tens of millions of pounds. Tata had said it is also facing cashflow difficulties due to a drop in the price of steel, one of its key products.
[Source: Daily Telegraph]