Tata threatens govt over e-car loan decision
'Give us the cash, or else!'
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Leccy Tech The government’s relationship with Indian car maker Tata could be turning sour, following delays over a multi-million pound e-car loan.
Tata wants a £10m govt loan to help it build a UK e-car production line
Back in April Tata applied to the government for a £10m ($16.3m/€11.6m) loan to help set-up a UK production line for its Indica Vista leccy hatchback.
But Tata’s since been told by the Department of Business Innovation and Skills that a decision on the loan won't be made for another eight weeks – significantly extending the length of time that Tata must wait for an answer.
Tata – which also owns Jaguar Land-Rover - has implied that this just isn’t good enough - threatening to bin entire the project if a decision isn’t reached pretty damn quickly.
If Tata is awarded funding then the cash will come from a £2.3bn ($3.8bn/€2.7bn) car assistance package, which the government announced back in January. The cash is earmarked for schemes that could help the UK car industry out of the current crisis and eco-friendly car development projects.
But it’s worth noting that a cross-party group of MPs recently pointed out that, to date, the government hasn’t spent a single penny of its car assistance package cash.
To make matters worse, the government is also still haggling with Tata over the exact terms of a €340m ($556m/€394m) loan that Jaguar Land-Rover agreed with the European Investment Bank back in April.
Reading between the lines, the government's caution may be something to do with the fact that it lent MG Rover £6.5m ($10.6/€7.5m) back in April 2005 - only to see both the cash and the company vanish down the toilet almost immediately afterwards. ®
COMMENTS
Not again....
As ever, some tripe replies to a story concerning the ongoing trend of this Government failing to do what it bores everyone to tears about; the need to invest in the future.
Consider this: When you have a company that has contributed untold tens of millions to the Exchequer in taxes and is a major employer and exporter, then is helping them with loan guarantees really such a big deal?
When a company wishes to invest in THIS country to make vehicles, of which a percentage will similarly be exported, employing people (and so taking them out of the social payments circuit) then is providing a grant such a huge problem?
Well, is it?
FO indeed. Jesus.
Send a gunboat!
Hmm. Dodgy manufacturer of iron busses in India threatens sovereign government. Which of the two has armed forces, eh?
I'd tell em to pi** off.
Shares
In Germany, the state of Lower Saxony holds "golden shares" in VW which ensures they can put a stop to any idea of VW moving production elsewhere. They didn't just give VW a loan and rely on a promise that they would stay.
I'm not a fan of nationalisation but shares are better collateral than promises. This can be applied to car manufacturers or banks or building societies.....
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