From Our Special Correspondent
The British Motor Corporation, in a long awaited announcement of the outcome of the negotiations with the Government over their £49m. expansion programme, disclosed yesterday that over the next two years they will spend nearly £21m. on building and equipping new factories to provide more than 11,000 new jobs in three areas of high unemployment-Scotland, South Wales, and Merseyside.
Negotiations with the British Motor Corporation were remarkably speedy and lasted less than a month. It is expected that the pattern set up by the BMC scheme will be broadly followed by those still to be approved. The policy of the Government is that expansion on a firm’s present site is not always the best course either from a social or an economic viewpoint. The British Motor Corporation’s scheme is regarded as an outstanding contribution to the policy of encouraging industries to go to areas of high unemployment. It is expected that a single scheme of this sort will undoubtedly attract ancillary industries to the same parts of the country.
£26M. EXTENSIONS IN MIDLANDS NO EXTRA LABOUR
FROM OUR OWN CORRESPONDENT
BIRMINGHAM, JAN. 21
In addition to the three new factories, the British Motor Corporation announce that another £26m. will be spent on extensions to their existing factories in the Midlands and at Oxford, but no new demand for labour will be created in these already prosperous areas. Nor will the expansion at the Longbridge factory here extend the Birmingham industrial sprawl into the Worcestershire green belt as many people feared.
In the ‘package deal’with BMC over the first of the motor industry’s big expansion schemes to be concluded, the Government have achieved their main aim of diverting new capacity to areas where the social and economic need for it is most acute. Mr George Harriman, deputy chairman of BMC, said today: ‘We may as well be frank. It was our intention to expand alongside our existing factories, but the Government wanted us to go to areas of high unemployment. After considerable negotiations conducted in a very cordial atmosphere, we have reached what I hope will be a successful conclusion.’
In a nutshell, BMC plan to raise their annual output of vehicles from 750,000 to one million within two years by extending their car and light commercial vehicle production in the Midlands and by moving the manufacture of heavy commercial vehicles and tractors from Birmingham to Scotland. They plan to build a new factory costing £8,800,000 and employing 5,600 people at Bathgate in West Lothian. Exact details of the location of the site, chosen from 12 inspected in Scotland, will not be disclosed until borings and other survey work due to begin on Sunday are completed.
Another new factory, costing £7,500,000, is to be sited between Llanelli and Trostre, near the sheet steel manufacturing resources of west South Wales. This plant, which together with an extension of the existing radiator factory at Llanelli will employ 4,200 workers, will provide pressings and major sub-assemblies for the corporation’s Midland car factories. Mr S. Samuel, Town Clerk of Llanelli, said that he had received confirmation that the site for the new factory would be immediately east of the Trostre works of the Steel Company of Wales at Llanelli.
The third of the new factories for the labour surplus areas will be a £4,200,000 plant at Kirkby, near Liverpool. employing 1,500 workers. BMC intend to relocate there the domestic appliance production of their car bodies branch, Fisher and Ludlow Ltd. at Castle Bromwich, which makes sink units, washing machines, spin dryers, vending machines and refrigerators. BMC are also to build a new works at Swynnerton, in north Staffordshire, for the packing of knocked-down sets of vehicle components for assembly oversea. This establishment will employ 1,000 workers.
The new factory buildings in Scotland, Wales, and Merseyside will be erected for BMC by the Government at a cost of £9,500.000 on a 15-year amortization basis. The new plant will provide about 75 per cent of the additional area required by the corporation for expansion, the rest coming from extensions costing £26m. at their present factories including Longbridge, Washwood Heath and Erdington (Birmingham) and Oxford. The remainder of the £49m. expansion scheme will be on oversea projects.
Labour at present engaged on processes to be transferred to the new areas will be redeployed in the reorganization of car and light commercial vehicle output.
‘We shall provide a job in the reorganization for every one of the 56,000 men we have on our books at the moment,’ said Mr Harriman. Senior executives of the corporation, he added, had discussed the developments in Wales, Scotland, and Merseyside with local trade union officials, who had unanimously welcomed their plans. The corporation have agreed with the unions that earnings of their workers in the new areas will be in line with existing local rates. In general these are considerably lower than those in existing car centres. Several hours before details of the development programme were released today, managers in each of the BMC branch factories announced the plans to shop stewards.
‘All the proposals were well received,’ said Mr Harriman. BMC hope that during their expansion they will continue to sell half their total production in export markets. This should bring their annual oversea earnings to £210m. by 1962.