Rover in limbo after BMW sacks bosses

THE FATE of Rover's giant Longbridge car plant in Birmingham was thrown into confusion last night as the two top executives at its parent company, the German car-maker BMW, were sensationally dismissed from the board.

After a day of high drama and suspense, BMW's chairman, Bernd Pischetsrieder, the greatest supporter of keeping Longbridge open, and his biggest opponent, the deputy chairman, Wolfgang Reitzle, were both removed from the company. Mr Pischetsrieder's successor as chairman is to be Joachim Milberg, according to British union officials.

It was not immediately apparent whether the dramatic news signified a reprieve for the threatened Longbridge plant and its 15,000 workforce, or whether the new BMW management would proceed with closure.

Mr Reitzle had been tipped to take over the top job from Mr Pischetsrieder, in which case Longbridge would almost certainly have closed.

The news of both men's departures came after an all-day meeting of the BMW supervisory board called by the controlling shareholders, the Quandt family, to resolve the crisis surrounding Rover.

Earlier the Government had made clear that there would be financial aid available to BMW to keep Longbridge open.

Closure of the factory would cause up to 50,000 job losses in the West Midlands and spark a political storm. Stephen Byers, Secretary of State for Trade and Industry, urged BMW to honour the agreement it reached with unions late last year to keep the plant open.

"The workforce have made changes. We are now looking to BMW to say that it's business as usual, that there are no more changes, that they want to continue with their commitment to Longbridge," he told BBC television.

Mr Byers, who was due to talk to BMW management last night, also indicated that financial help would be available to BMW. The company had been seeking between pounds 200m and pounds 300m from the Government to support development of a new medium-sized car at Longbridge.

"It's no secret that we have been discussing possible support to help them improve productivity, to help them build some new facilities at Longbridge," he said.

However, in what may prove an ominous sign for the plant, BMW has yet to put in a formal application for aid, suggesting it may have already decided not to go ahead with the new model in the UK.

Mr Pischetsrieder announced in December that BMW had agreed a new productivity deal with unions involving 2,500 job cuts and efficiency savings of pounds 150m a year. In return, BMW agreed to invest pounds 400m to build a new Mini at Longbridge and confirmed it was the preferred site for a new car, code-named the R35, to replace the Rover 200-400 series.