The return of car production to Longbridge will accelerate today when a key supplier signs a #3 million deal to restart body shell production at the former MG Rover site.
Stadco, which used to supply the parts for the MG TF sports car, is one of 150 sup-pliers who have agreed to provide components for Nanjing Automobile's (NAC) relaunch of the car next year.
Following a joint investment of more than #3 million, it has begun begin shifting part of its production from Coventry to Birmingham in a move which will generate up to 50 new jobs at Longbridge.
The move, which is due to take place next month, could be followed by other manufacturers who have been approached to move to the factory.
The body shell facility had been mothballed at Stadco's factory in Holbrook Lane when MG Rover collapsed into administration in April 2005.
But following the signing of the deal - which could ultimately be worth up to #2 million per year to Stadco - the new facility will be set up early in the new year.
The new unit, based in the CAB B building, will resume production by April and start full production in time for the relaunch of the new TF sports car in July.
Early volumes of the car are expected to be around 4,000 vehicles per year, although this could rise to meet demand.
Stadco, which took over the panel making business from Mayflower which collapsed in 2004, will lose no jobs in Coventry.
It expects to take on former MG Rover workers and Stadco workers who lost their jobs during the MG Rover collapse.
Paul Jaggers, product engineering director of Stadco, said: "Over the time I have spent with NAC I believe they are very serious about being in the UK and European market.
"We see this as an opportunity to build this product and also to work together. We are also discussing opportunities in China.
"We see this as part of our global expansion strategy. This could lead to work on other platforms for NAC and in China."
Mr Jaggers added: "We are pleased to be part of the rebirth of the MG brand. We have got an emotional attachment to it going back to the work we did on the MG F.
"Mayflower were key in getting that car on the road and made substantial invest-ments in its facilities to do so.
"We built the body shell for ten years, and know how it all works. We were a key part in bringing that vehicle to market and we will be again."
Andrew Morriss (CKD), managing director of Stadco, said: "This is an important stepping stone in the return of the MG TF. NAC has the will and the ownership and we have the skills and experience to bring this to reality."
Stadco is also involved in the modifications to the TF design, including remodelling of its interior trim, bumpers, lamps, as well as a possible hard top coupe version which could be introduced in 2008.
As part of the deal, a team from Stadco will also travel to China to help establish a body shell production facility for NAC's new factory in Nanjing.
James Lin, operations director of NAC at Longbridge, said he welcomed the move, which could be followed by other suppliers.
He said: "Stadco used to be an original supplier to Rover, so we know by working with them we can maintain the quality on important product.
"Stadco has also provided technical for our factory in China. This kind of project is the first stage in our global startegy.
"Stadco are good are engineering design and product development and have a very good understanding of the US market."
As well as manufacturers, NAC has signed agreements with engineering service providers like MIRA and Prodrive.
Seating manufacturers and wheel companies have also voiced an interest in moving to Longbridge, said Mr Lin.
Wagn Hong Biao, chairman of Nanjing Automotive UK, said: "We are pleased to secure Stadco as a supplier because they bring a wealth of experience with them."
Mr Lin, said: "There was rumours about us moving our operations to Coventry. That was wrong. What we are doing is moving Coventry operations to Longbridge."