Business minister Lord Mandelson said yesterday that aid for Jaguar Land Rover was “very much” on the government’s agenda – but any package would depend on talks between the company and its bankers to overcome its cash crisis, he stressed.
Lord Mandelson made the comments in a conversation with Clive Dutton, director of planning and regeneration at Birmingham City Council, behind the scenes at yesterday’s jobs summit in London.
“I took the opportunity to raise the Jaguar Land Rover with Lord Mandelson and he said the issue was very much on the agenda but that he needed evidence on how talks with their bankers are progressing,” Mr Dutton said.
“Clearly they are acutely aware of the issues and any response will be based on evidence that the company gives.”
Meanwhile yesterday, Land Rover employees returned to the Lode Lane factory in Solihull after an extended Christmas break to find the plant idle.
Speculation quickly spread that up to 1,500 jobs were to go as managers confirmed that car assembly operations would not resume until next week.
In response, Jaguar Land Rover chief executive David Smith said: “We cannot confirm further job cuts but given the severity of the economic conditions, both the credit crunch and the collapse in market demand, we have made it clear that further actions are likely.
“Any actions we take will be communicated to our employees and their representatives first in the usual way.”
The Birmingham Post, with sister newspapers in Birmingham, Coventry and Liverpool, is campaigning to persuade the Government to give JLR the commercial loans, or loan guarantees, it needs to restore cash flow and liquidity curtailed by the refusal of banks to advance credit to itself and its customers.
Mark Foster, Land Rover manager of corporate affairs, said: “Everyone has returned to work today and there have been meetings informing staff that there will be no production at Solihull. Production will recommence on January 19. They are being briefed on targets for 2009 and duties in a non-production week. These duties include training on health and safety, diversity and new production systems.”
One member of the 5,000-strong workforce, who did not wish to be named, said: “There are meetings going on everywhere but we are being told nothing.
“It’s diabolical. All we are being told when we ask is that VRs – voluntary redundancies – are still open to us.
“Something needs to be said about this. All that’s happening is people are milling around. The only thing that is running in here is the heaters.”
Another member of staff, who called us, added: “There are rumours of a major announcement on 1,500 redundancies but nobody knows at the moment. Bosses wanted to give everyone an extra week off but I don’t think the unions wanted that.
“They are just sat around at the moment but some have gone home taking it as owed holiday. We also know that staff who took a three-month sabbatical were due back this month but have been offered an extra month and will not come back until February.”
The Christmas break had been extended by a week until today and that move followed the axing of night-shifts and an extended break in October.
JLR said work resumed yesterday at the company’s plants at Castle Bromwich in Birmingham and Halewood on Merseyside.