China deal 'could see MG Rover production increase'
The head of MG Rover today held out the prospect of increased production at the car giant’s UK factory under plans to link up with China’s biggest auto manufacturer.
The loss-making firm, Britain’s last independent volume car maker, is setting up a joint venture with Shanghai Auto to produce a range of new models.
MG Rover, sold by German car company BMW for just £10 four years ago, is hoping to gain approval from the Chinese government in the New Year.
Up to £1bn (€1.43bn) is expected to be invested in new models in return for the Chinese company taking a 70% controlling stake in the business.
John Towers, chairman of MG Rover, said today that jobs will remain at the company’s plant in Longbridge, Birmingham, after the deal goes through.
Asked on the BBC Radio 4 Today programme whether jobs would be secured for life, Mr Towers replied: “No one guarantees anything in this industry but the fact that cars will continue to be produced at Longbridge, arguably in higher quantities, is the best guarantee we can give.”
Mr Towers said that, although it was easy to sell any company to China, the Far East or Eastern Europe, “one of the unique aspects of this deal is... that we have established that the jobs will remain at Longbridge”.
He maintained that workers at Longbridge were “very happy” with the Chinese venture as well as with the amount of money they earned.
Mr Towers said the reason he was speaking so positively about the proposed deal was that a lot of work had already been carried out, adding: “This deal will happen.”
Analysts believe that the introduction of new models will boost output at Longbridge from 110,000 a year to almost 200,000, although some experts had said that the Chinese could eventually decide to produce all the cars by themselves.
