Rover boss plays down Honda link

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The Independent Online

New Rover boss John Towers today played down reports that his Phoenix Consortium is looking to Japanese car giant Honda for a long-term business partnership.

Reports today said Mr Towers' group, which dramatically bought Rover from its German owners BMW yesterday, had held secret negotiations with Honda to secure the company's future.

But he said that although he had had "some contact" with Honda, this concerned ongoing business arrangements and he refused to rule out the possibility of other companies joining the group.

"During the previous history of Rover, there were a lot of very good relationships built between ourselves and Honda," Mr Towers said.

"When I have mentioned the collaborative part of our strategy, people have immediately leapt to that assumption.

"But of course Honda are not the only candidate who might wish to play a part in this process.

"There has been some contact with Honda and there had to be because of a continuing business relationship, but we haven't had any significant discussion on that matter," the former Rover executive told BBC Radio WM.

Honda still has a licence to make gearboxes and other components for Rover, he added.

Meanwhile, workers were arriving at Rover's Longbridge plant in Birmingham to start their first full day of work since the Phoenix buyout.

An estimated 1,000 job losses are expected at the complex but Mr Towers has pledged to turn the company back to profit within two years.

He and union leaders were today getting down to the business of planning Rover's future after BMW sold its loss-making subsidiary for a symbolic £10 after seven days of negotiations ended in the deal just weeks before the deadline set for the factory's closure.

The expected job losses are a fraction of the several thousand anticipated if Rover had been bought by initial bidders the venture capitalist group Alchemy Partners.

Phoenix received about £500 million from BMW and £200 million in private backing from United States bank First Union to finance the sale. No state aid was involved.

Phoenix will continue building the Rover 25 and 45 and the MGF sports car at Longbridge as well as the current Mini, until the new Mini is built at Cowley, near Oxford next year.

The top of the range Rover 75 will be switched from Cowley to Longbridge and an estate version is being planned.

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