Malcolm Harbour, Conservative Member of the European Parliament for the West Midlands, calls for a bridge to the future for Jaguar Land Rover.
On a cold December afternoon a year ago, I was interviewed by an Indian TV station outside the Jaguar plant in Castle Bromwich.
I said that our region welcomed Tata’s ownership of Jaguar Land Rover, because they would be fully committed to investing in new models and sustaining them as top brands. I noted that, even in a world where more efficient vehicles would be demanded, JLR was already well placed with new lightweight construction technologies and efficient power trains.
I confirmed that MEPs had brokered a deal to ensure that European rules promoting more fuel efficient cars, had taken account of the specialist role of JLR. I pointed out that Land Rover had made astonishing progress over the years since it was bought by Ford from BMW, especially in the tough US market. I emphasised that there was no question of Jaguar being sold separately as I was confident that Tata would be really excited by their new product portfolio.
So where do we stand today? Since the summer, the car industry has seen a faster decline in its sales, than any other major manufacturing sector. Every major region has slowed dramatically. Car customers are staying away from showrooms because of uncertainties about their economic future and their inability to get credit to finance a car purchase. Company car buyers are deferring purchases because of worries about their own business prospects.
This sharp global economic recession is hitting JLR at a critical stage under its new owners. It is the UK’s only full line car making company, and we must find ways to help retain the research and development, manufacturing plants, suppliers and dealers that will be needed to underwrite their future.
That is why the UK Government and the European Commission must help JLR build a “Bridge to the Future”. This is not a “bail-out” of a failed business model, like the “rescue” of British Leyland by a 1970s Labour Government. I know the difference, because as a BL vehicle engineer, I was there at the time!
What needs to be done? Firstly, we must set up credit lines that will allow JLR to sustain investment in new greener products through this downturn. In October, I participated in a high level car industry review with European Commissioners. It was agreed that the European Investment Bank will help fund research and development in new generation green models.
JLR needs working capital, to help suppliers to retrain staff and retool factories. We have been pressing the Government to extend its guarantee programme to enable them to draw down the funds they need.
All European governments should help mobilise consumer car credit by providing bank guarantees or other incentives. Just boosting UK markets is not enough. With the current level of the £ to the €, JLR has excellent prospects across Europe.
Corporate tax incentives would encourage company car buyers and leasing companies to come back into the market. Vehicle registration taxes also need to be examined. In a number of European Countries there are incentives to replace old, polluting cars - why not in the UK as well?
I congratulate the Birmingham Post on it campaign, but its not just JLR that needs a Bridge to the Future. Britain’s other car makers operate globally competitive factories with top productivity, quality and flexibility. We need BWM, Toyota, Honda, Nissan, Ford and GM to keep their employment and skills here.
Not forgetting other regional companies, LDV, LTi and Modec. This is a campaign to sustain a key British manufacturing sector for the long term.