MG Rover

[Ruggerbugger]

After watching the decline of Alstom in my home town, and the kick in the teeth it gave my Dad and hundreds of others, I feel terrible for the guys at MG Rover, and the supply companies.

I don't want to sound protectionist/isolationist, but when are we going to support our disappearing manufacturing base and highly skilled workers - when we've all got warehouse jobs at Gap?

Good luck guys, I hope it works out for you.

[DaBeeeenster]

Market forces I am afraid mate. Other nations can make better cars, simple as that.

If you want a stable job, train as a teacher, doctor or nurse.

I know it's a bit of a hardline, but that's the way it is, and I speak from experience. I lost two good jobs within the space of a year due to the companies I was working for going under.

[TiG]

I personally believe that i'd prefer to see whatever money was potentially used to keep an unprofitable business going, used to start new businesses to employ people.

Rover has been in an awful position for years. I feel for the people losing their job, but proping up a failing business IS not the answer.

TiG

[Knoxville]

We can't subsidise all our companies so they can compete against other companies all over the world that can make a better product for less, it just can't be done.

I feel sorry for people that loose their job like that I really do but to be brutally honest most of the work I saw being carried out on rovers production line and in the manufacturing area's wasn't hugely skilled and for the most part is something that could be applied to another trade. What I think is wrong is that the government was talking about stumpting up millions of pounds to help rover but they won't help the employee's when it goes under by perhaps providing training for them to go into another field of work.

[Flibb]

Never figured out why public money isnt spent in a positive maner. In the USA government contracts are mostly issued to US companys, that goes for vehicles, food for the millitary, etc, much of Europe does the thing. Not us oooh no we get meat for the Army, cars for councill workers, police cars, etc, but thers no incentive to buy British. The impact on public finances would have been minimal, but the benefits to somebody like Rover might have made a difference.

[Stoo]

Who said they wouldn't?

The TDI is already on it..

[Russ]

Never figured out why public money isnt spent in a positive maner. In the USA government contracts are mostly issued to US companys, that goes for vehicles, food for the millitary, etc, much of Europe does the thing. Not us oooh no we get meat for the Army, cars for councill workers, police cars, etc, but thers no incentive to buy British. The impact on public finances would have been minimal, but the benefits to somebody like Rover might have made a difference.

ever heard of international trade links??

guess not.

[nichomach]

What I think is wrong is that the government was talking about stumpting up millions of pounds to help rover but they won't help the employee's when it goes under by perhaps providing training for them to go into another field of work.

Hang on, the government was going to put up a £100m loan as long as SAIC were going to commit to a deal. That money would then have been paid back. They could only lend for a year without falling foul of competition rules, and SAIC wouldn't agree to a deal unless Rover could show it would be solvent for 2 years. The government are discussing whether car manufacturing can continue at the plant in some form and they've already announced a £40m aid package to help suppliers who'll have to find other customers. The PM and the Chancellor were due to visit the West Midlands for crisis talks about the problem. No-one's ignoring it, and there's already a joint task force being set up. Before we start bitching about the government, can we ask where Rover's money actually went, please?

BBC Linkage

* Rover sold off their finance arm MGR Capital directly to the four Phoenix directors, so they make no money off finance (although the directors do)
* Rover sold off their parts business to Caterpillar
* Rover sold off the land their plant's built on to another company and leased it back
* They don't own the Rover brand having sold it to BMW
* All their dealership properties are so heavily mortgaged that they can't sell them
* They were in the process of selling the MG brand to SAIC as a separate deal

Bluntly, the company has no real assets left, having sold them off. And where did the proceeds go? I'm not surprised the directors were offering to commit £10m of their own money to the SAIC deal; after all the above, they should be able to just about afford it...

[5lab]

nm

[RoGuE|SaBeR]

Rover was a dead duck ever since Phoenix Holdings took it over from BMW to be honest.

The ironic thing is that now someone will most likely buy the MG brand and then continue its line of products. Back when Phoenix were buying Rover from BMW there was another group, Alchemy Holdings, which had the plan of buying MG Rover and selling off all the Rover assets and carrying on with the MG brand - The exact situation which is most likely to happen now.

We were discussing this in Business Studies today and it came up that surprisingly the Chinese consortium who have supposedly “been on the brink” of signing a deal with MG Rover since last August if you believe the press only got a look at Rover’s books in the past 2 months or so. They saw the state of the business’s balance sheet and did a runner. It struck us as extremely odd that the Chinese only saw the books quite recently yet claimed all they had to do was sign the papers. First class bull if you ask me.

People were harping on about how SAIC would save the 6000 odd jobs at Longbridge. That’s utter crap when you look at the state of Longbridge as a plant – it has a main road running through the middle of it! It is probably the most poorly designed car manufacturing facility in Europe and somehow people expected the Chinese to stay there. I doubt it! They were mostly likely going to liquidate one of Rover’s best assets, its land, and then move the factory to a better designed location which was more efficient and required less labour.

Should it be saved to ensure there is a British manufacturing base? Think about it this way, the average production line worker is probably asking around £6/hr to sit and do something that someone in Malaysia or Korea will gladly accept £6 a day or maybe even a week for! How can you possibly convince businesses to stay in Britain and pay those sorts of labour costs? The workers in foreign countries are every bit as skilled for those menial production line jobs as the ones in Britain.

What Britain does do well however is high technology production. Manufacturing that requires highly skilled labour, in which Britain holds its own. Volume car manufacturing doesn’t really fall into this bracket. Rover is finished, as a private company the government is under no obligation to do anything about its demise.

[Kumagoro]

BMW shouldnt have been allowed to take the mini and dump them... esp as far as i remember they broke the contract with the gov in someway.

[RoGuE|SaBeR]

BMW still own Mini, it was the sweet cherry!

And I doubt that the new Mini would have been anywhere near as successful as it was without BMW's money to back it both in research and promotion.

[Oakey]

It should be noted that the board members of the Phoenix Consortium paid themselves £40million last year

[Ruggerbugger]

And all the workers will get is government minimum redundancy, which works out to about £11K if you've been there 20 years. To say nothing of the likely state of the pension fund...

[DaBeeeenster]

BMW shouldnt have been allowed to take the mini and dump them... esp as far as i remember they broke the contract with the gov in someway.

International Asset stripping is frowned upon but I'm not sure if it is illegal. It certainly shows the true colours of BMW, however.

[Oakey]

It's not like the Phoenix Consortium were any better. They did the same, they sold Rovers finance company to themselves (ie, the Directors), they sold the land the plant is on, they say they sold the rights to the Rover 75, god only knows what else.