Government 'won't be rushed' into car industry action

The Government is determined to secure the future of the UK motor industry, a business minister has stressed after Jaguar/Land Rover announced a two-week production stoppage at its Castle Bromwich plant in the West Midlands.

"This is a sector with a strong future and we are determined to ensure that the car sector remains a permanent and important part of our manufacturing base," Lord Carter of Barnes said.

But he said the government would not be rushed into taking action that might not work.

Lord Carter was responding to cross-party calls in the Lords for more help for the struggling automotive industry, amid redundancies, layoffs, and production stoppages across the country.

He said Business Secretary Lord Mandelson's department was "extremely focused" on the issues, on the importance of the sector, and on its reach into the economy both geographically and into other businesses.

Lord Mandelson was currently on a trade mission to India, where he was scheduled to meet, among others, the head of multinational motor group Tata.

But, apart from the credit crunch, Lord Carter also highlighted issues of "structural and cyclical change" for the UK automotive industry. 2007 had been a "bumper year", with 2.4 million new registrations, that was unlikely to be repeated.

The downward trend in new registrations was "likely to continue for the immediate future".

This would require some adaptation by the industry to a "somewhat more constrained and differently configured market".

Ministers were "considering carefully" a variety of suggestions and further information from the industry, and there would be a second automotive "summit" at the end of the month.

"Lord Mandelson has made clear that if there is appropriate assistance that we can offer, then we will consider it," his junior minister stressed. "We need to be sure that any action we take will work in the UK, for the UK."

Lord Carter told peers: "We fully understand the urgency but we will not and cannot be rushed into taking action that might not be effective. Clearly any assistance needs to be for the future, not for the past."

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