Ministers consider Government support for Jaguar Land Rover
Ministers have held discussions with Jaguar Land Rover over the possibility of state assistance for the car maker, Business Secretary Lord Mandelson said today.
But he stressed that the West Midlands-based firm’s Indian owners Tata had “the first responsibility” to ensure its survival and warned that the Government did not have “an open cheque-book” to bail out ailing private companies.
Lord Mandelson said it was too early to judge whether state help would be needed at Jaguar Land Rover, which employs around 15,000 in the UK, or other parts of the British automotive sector.
The company announced last month that it was laying off around 850 IT and engineering staff in the West Midlands by the end of the year in response to “severe” global car market conditions which are affecting the whole of the sector.
Lord Mandelson today told Sky News: “I’m talking to the car manufacturers. We are analysing very carefully what is going on in the sector and we will make good judgments in good time if it is appropriate for the Government to take any action or if it is possible for us to do so.
“We are looking at the sector as a whole. I have had discussions with the owners and management of Jaguar Land Rover in particular, because they argue that they are under particular strain.
“But they have owners who are well-resourced, who have the first responsibility for sustaining the companies that they own in existence and in production for the future.
“If we judge that it is not just short-term difficulties but longer-term pressures that are operating in that sector, or in relation to that particular company, then we will consider what measure, what intervention we can appropriately make. But the time for that decision has not been reached.”
Lord Mandelson warned that not every private company which gets into difficulty can expect Government help.
He indicated that ministers would look at a range of factors when deciding whether a company qualifies for assistance, including its general viability, the strategic importance of its sector, its technological and research standing and the impact its failure would have on jobs in the supply chain, as well as the workers it employs directly.
While he warned that there will not be “a great long list of industrial bail-outs”, he appeared to indicate that car makers might have a case for help.
“The car sector - car manufacturing - is a centre of real excellence and competitive strength in our country,” he said.
