London: As the UK dilly dallies on a loan lifeline to India’s Tata-owned Jaguar Land Rover, the British media is putting out stories that the once venerable conglomerate is after all not so invincible.
British Prime Minister Gordon Brown has so far ignored calls for assistance to car makers, saying “there is no promise that we’ve made of any support”. But this hasn’t stopped reports of assistance in all possible combinations.
The Sunday Times reported that ministers are considering a direct government loan of perhaps £500 million to Jaguar Land Rover, the Midlands carmaker, whose sales have been wiped out by the credit crunch.
JLR’s deep-pocketed Indian owner is facing similar woes back home. Tata Motors has seen lorry sales fall by 50% and its high-profile project to build the world’s cheapest car ‘Nano´ was hit by scandal and delay, noted a columnist in The Independent while likening the Tatas to a giant with a begging bowl.
With UK car production down by a massive 33% last month, JLR might be expected to turn to the Tatas for help, the paper said adding that the trouble is that JLR is not the Tatas’ only problem child.
JLR, acquired by the Tatas early this year for £1.5 billion, was in talks with the government for a £1 billion loan guarantee.
The Independent report further said that “Tata Steel, one of the empire’s original businesses, is also reeling. With steel prices dropping through the floor, it has axed 500 UK jobs at Corus, the Anglo-Dutch steel giant, it bought for £6.2 billion last year and is looking for state aid from the Dutch and UK governments to avoid further redundancies.”