Motor industry seeks way out of financial crisis

Motor industry leaders press the government on solutions to the sector's acute problems

The UK motor industry has welcomed the government’s commitment to work with the sector to tackle problems arising from the credit crunch.

 The Society of Motor Manufacturers and Traders (SMMT)  met Lord Mandelson, the Business Secretary, to discuss the difficulties faced by the sector, which has been hit by falling vehicle sales and a lack of financial liquidity.

SMMT chief executive Paul Everitt described the meeting as "open and constructive", although he did not reveal the details of the agreement.

He said: "The industry outlined the scope and scale of the challenges it faces and the unprecedented difficulties in the market place.

"We emphasised the urgent need to address liquidity and restore demand and discussed a variety of measures to address these challenges.

"Government and [the] industry have agreed to explore, collaboratively, a range of solutions in a timescale that matches the urgency of the situation."

The news came as UK car group Jaguar Land Rover said it was laying off 850 IT and engineering staff at plants in Castle Bromwich, Solihull, Whitley, and Gaydon, all in the West Midlands, by the end of the year.

This is in addition to plans already announced to offer 600 voluntary redundancies to workers at it factories.

Unite union national officer Dave Osborne said: "These latest [Jaguar Land Rover ] reductions mean it's more important than ever for the government to take direct action to make low-cost loans available to the car industry, to help these businesses through the current crisis.”

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