UK loan package to benefit Tata's Jaguar-Land Rover
28 Jan 2009
British luxury cars Jaguar-Land Rover, now owned by Tata Motors, and Vauxhall are expected to benefit substantially from the 2.3-billion pound loan package announced by the British Government yesterday.
The House of Commons on Tuesday announced 1.3-billion pounds in guarantees to unlock funds from the European Investment Bank and a further one billion pounds of other lending.
The loan package, announced by business secretary Lord Peter Mandelson, will be tied to investment in low-carbon initiatives to produce lower-emission cars.
Britain had some of the world's most productive car plants and the government is not giving a "blank cheque" to the car makers, said Lord Mandelson, adding, "This industry is not a lame duck and this is not a bailout."
"The government has recognised the strategic economic importance of the car industry in the UK as a major provider of high-skilled jobs and a significant contributor to our balance of trade," said Jaguar Land Rover chief executive David Smith.
The loan package received support from the car manufacturers but unions expressed disappointment.
Lord Mandelson said a further 35 million pounds could be available for retraining workers in the automotive sector and there would be a "step change" in research for greener vehicles.