JLR Funding a 'Step in the Right Direction' to Survival; Bank Loans 'A Positive Sign', Says Car Group

Article excerpt

Byline: NEIL HODGSON

JAGUAR Land Rover has taken a "step in the right direction" in securing the long-term future of its Halewood plant after announcing a fresh injection of funding, a leading industry analyst claimed last night.

But Howard Wheeldon, senior strategist at London-based BGC Partners, warned the Knowsley site and its 2,000-strong workforce still faces upheaval.

JLR's Indian owner Tata announced yesterday that it has secured a series of loans with commercial funders, including a pounds 75m deal with Bank of Ireland subsidiary Burdale, to ease its short-term future.

And it said it was confident it would not now need the Gover nment to underwrite a pounds 340m European Investment Bank loan which it needs to continue development of new environmentally-friendly models like the LRX concept car which could be built at Halewood.

Mr Wheeldon, who exposed acrimonious divisions between the Gover nment and JLR over backing for the European loan, said: "It is not right to say this is an absolute surety of Halewood's long term future, but this is a highly invested plant and it goes a long way to achieving that end.

"In the meantime, there is a lot of adaptability and change that JLR has to take on board.

"Nothing is certain, but we are taking a step forward and in the right direction."

JLR and the Gover nment had been locked in talks since last September over its support to guarantee the European funding in case the car maker collapsed.

But JLR has now avoided the need for state intervention and says its new funding lines show the banks' confidence in the business. …