Rover crashes pounds 650m into red
Friday 19 March 1999
Rover made a loss of around DM1.87bn (pounds 650m) compared with a loss of pounds 91m in 1997. Its German owner BMW disappointed analysts with a 27 per cent fall in net profits to DM903m.
BMW said the sharp rise in losses at Rover was a result of "model changes, market and currency factors and the restructuring measures".
The figures came as BMW executives examined details of the Government's offer of grants aimed at securing the future of Rover's Longbridge plant, which employs 12,000 people.
BMW is debating where to build the production site for the successor to the Rover 200 and 400 series mid-range car. It has submitted grant applications to both the UK and Hungarian governments.
Stephen Byers, Trade and Industry Secretary, confirmed that he had finalised a "complex" package in time for BMW's board meeting yesterday. The subsidy package is believed to amount to pounds 180m. He expects further talks with BMW in the next few weeks.
Tony Woodley, chief car industry negotiator for the Transport and General Workers trade union, said he was confident that BMW would choose Britain.
"Fifty to sixty thousand jobs depend on this decision, and of course the company understands that and the British government understands that," he said.
Industry sources said they did not expect an announcement until the middle of next week.
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