Auto industry supply chain is collapsing day by day, warns JLR chief
Jaguar Land Rover suppliers are collapsing into bankruptcy “every one or two days” as the cash crisis facing the Midlands’ biggest manufacturer tightens its grip.
JLR chief executive David Smith warned of the perils facing the supply chain amid growing condemnation of last week’s announcement by the Government of a £2.3 billion package for the UK car sector.
The aid package unveiled by Business Secretary Peter Mandelson was dismissed as “too little too late,” “small beer” and a “pittance” by key speakers at a special automotive summit organised by the Birmingham Post at the ICC.
Mr Smith called for “urgent and practical” Government action to ease the cash-flow crisis which is strangling the UK car sector, threatening tens of thousands of jobs.
He told delegates at the ICC: “In 25 years in the car industry, I have never experienced a time quite like this.
“What we need now is urgent and practical action. Banks aren’t lending and consumers aren’t spending. Someone has to put oil back in the engine.
“We have suppliers at the moment going into bankruptcy every one or two days - this is a very, very serious problem now.”
Mr Smith called for urgent measures from the Government to kick-start access to credit and stimulate sales.
“Our priority has always been access to credit covered and supported by loan guarantees. This credit is still not flowing.
“We need the funds the Government is guaranteeing to arrive quickly. With the key March selling month just around the corner further work has to be expedited and accelerated if we are to fill our plants again.”
Unite joint leader Tony Woodley said the car industry was facing a battle for survival, with over one million jobs caught up in the crisis.
“That £2.3 billion was welcome but it is a pittance compared to what our industry
