'Time running out' as van factory fights closure

Talks aimed at saving a van factory from closure have been held, but time was running out on hopes of securing the plant's future.

The LDV plant in Birmingham, UK, which has not produced any vehicles for more than two months following a global downturn in sales, could close for good within days after its owners warned it was "literally running out of cash".

The closure would mean the loss of thousands of jobs.

The firm, owned by Russian giant Gaz, announced that a management buy-out aimed at transforming the manufacturer into Europe's first "green" van firm was nearing completion.

The plan, led by outgoing Gaz chairman Erik Eberhardson, would make the firm the first volume producer of electric vans in the UK, but is dependent on a bridging loan from the government of between £20m and £30m.

Company officials held talks today at the London headquarters of the Business Department with Business Minister Ian Pearson and trade union leaders, and said in a statement: "We had a long and constructive meeting with Ian Pearson, the buyout team, LDV management and workforce representatives this morning. Discussions are continuing and we continue to believe there is a viable long-term future for LDV."

Derek Simpson, joint leader of Unite, said: "What LDV needs urgently is time. Some short-term financial assistance from government will help them buy this time. Of course LDV's owners have a duty to do all they can to ensure this company stays in business and has a future, but our government also has a responsibility to do all it can to help safeguard the thousands of jobs that are now at risk.

"This is the time when we expect to see the government's assistance package for the car industry kick in. It is no good to businesses in need sitting in the Treasury.

"The government saying the taxpayer should not be bailing out the losses of LDV is a bit ironic on the day that they announced that they are going to buy £500m of toxic debt from the banks.

"It seems to me that these are relatively smaller amounts of money that would be needed to keep genuine, well-paid, skilled and crucial jobs to the economy in existence.

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