Thursday 22 October 1998
After four gruelling years at the wheel and pounds 3bn of fuel, BMW still has nothing to show for its investment. The new Rover 75 may look like the answer to its prayers, for those who like1950s retro-styling, but BMW would be ill advised to count on it. If the R75 suffers the same fate as its predecessors then it will be another pounds 400m down the black hole, along, quite probably, with BMW's top driver.
Threatening to close Longbridge is a handy way of beating the unions over the head and focussing the attention of Government at the same time. We have been here before, of course. The obituary of Longbridge has been written at least twice - first when Sir Michael Edwardes threatened closure, and then when the Conservatives tried and failed to sell Rover to Ford.
The men from Detroit bounced back from that disappointment by snapping up Jaguar for the princely sum of pounds 1.6bn. They soon discovered, however, that all Jag's leather and walnut merely disguised the lemon which lay beneath. For the first four years Ford too repented at leisure as sales shrank and losses ballooned.
Finally, Jaguar is now beginning to come good, as the fabulous S-type unveiled this week in Birmingham demonstrates. The transformation has not been achieved without government support. All told the taxpayer has provided pounds 123m to get the S-Type and the new baby Jag from Halewood on the road.
Peter Mandelson, the Secretary of State for Trade and Industry, is playing hardball by insisting that Rover's salvation lies in its owns hands, not in a bail-out from the Government. On the other hand, BMW is reckoned to be looking for only pounds 100m to ensure that production continues at the Longbridge plant, starting with the new Mini.
It might stick in the craw that the taxpayer is effectively being asked to help guarantee BMW's profit margin on the next model out of Longbridge. The whole concept of state aid for industry is a highly dubious one, in any case. Unfortunately, all European governments indulge in it, some much more enthusiastically than us.
Mr Mandelson has agreed to keep the coal mines open by rigging the energy market - a policy that will cost the country a good deal more than pounds 100m in the longer run. In Rover, he has a much more deserving case. Mr Mandelson expects the car maker to help itself by smartening up its act. In return, he should deliver on his side of the bargain.
- 1 Tamir Rice: 12-year-old boy playing with fake gun dies after being shot by Ohio police
- 2 To help fuel their propaganda machine against the poor, our government has now decided to redefine the word 'welfare'
- 3 Halle Berry takes ex-boyfriend Gabriel Aubry to court for allegedly trying to make daughter look less African-American
- 4 Isis propaganda image showing 'abuse of Muslim woman by soldiers' is actually taken from Hungarian porn film
- 5 'You should come to my house and eat cheeses with me': 4-year-old sends adorable love letter to girl at school
Turkish President: 'Equality between men and women is against nature'
Tamir Rice: 12-year-old boy playing with fake gun dies after being shot by Ohio police
Ferguson decision: Tea Party website mocks Michael Brown's family over T-shirt typo
Michael Brown shooting: Ten things we know – or know better – now the Ferguson grand jury's work is over
Isis propaganda image showing 'abuse of Muslim woman by soldiers' is actually taken from Hungarian porn film
Rochester by-election: Ukip gains second MP as Tory defector Mark Reckless holds seat
'Beast of Bolsover' Dennis Skinner takes Ukip MP Mark Reckless to task moments after he is sworn in
Rochester by-election: Labour MP Emily Thornberry resigns after posting white van and England flags tweet
France 'blocks' Russian sailors from boarding a warship
The young are the new poor: Sharp increase in number of under-25s living in poverty, while over-65s are better off than ever
Revealed: How the world gets rich – from privatising British public services
iJobs Money & Business
£Attractive: Citifocus Ltd: High calibre individual with significant product d...
£Negotiable: Citifocus Ltd: Leading global bank seeks experienced credit analy...
£Attractive Package: Citifocus Ltd: High calibre individual with a high degree...
£Attractive: Citifocus Ltd: High calibre individual with superior academics an...