Jaguar Land Rover.

[raymont]

Looks like we, that’s you and me as tax payers, are about to bail out Jaguar /LR.

Does anyone find it a bit strange that not a few months ago the gov’t was intent on taxing fuel guzzling vehicles into oblivion, and now wants to give their manufacturer our money?

Tata, group which bought Jaguar / LR, is a huge multinational operating in many sectors. I wonder if they really can’t raise finance through normal commercial channels as they claim, or perhaps they see our gov’t as a soft touch.

 

[wemorgan]

Think of it as a subsidy, funded partly by Jaguar and Land Rover drivers who buy plenty of fuel going back into the manufacturer they bought from.

 

[hawk20]

Think of it as a subsidy, funded partly by Jaguar and Land Rover drivers who buy plenty of fuel going back into the manufacturer they bought from.

We all buy fuel. Nothing special about that. Apparently a billion pounds (that's £1,000,000,000) is what is being asked from the taxpayer/govt. That is what Tata paid Ford for it. So they want it free.

And where do you stop? Why not Woolies, MFI and all the other manufacturing firms teetering on the brink.

Tata have loads of loot and no need to be subsidised by UK taxpayers.

 

[manalishi]

What he said.

 

[Mr E]

I'd feel a little more sympathy for Tata if it wasn't for the fact that they've just signed a big sponsorship deal with Ferrari.

There is no need whatsoever for HMG to hand any money to Tata Motor Corp. Tata are looking to cover losses they didn't spot during due diligence on the back of misguided loyalty to a british "heritage" brand...

 

[Stratman]

Well obviuosly the Indian government can't be expected to support one of its biggest firms. They've got a nuclear weapons programme to pay for.

 

[wemorgan]

We all buy fuel. Nothing special about that. Apparently a billion pounds (that's £1,000,000,000) is what is being asked from the taxpayer/govt. That is what Tata paid Ford for it. So they want it free.

And where do you stop? Why not Woolies, MFI and all the other manufacturing firms teetering on the brink.

Tata have loads of loot and no need to be subsidised by UK taxpayers.

Lots of rhetoric, but rather short on facts. We'll only know the details of the agreement once they're published.

I'm open minded on if and how JLR are to given aid, but to imply that no government aid should be given to any companies is naive. Helping individuals and companies is one of the government key roles. Even in good economic times the government offers subsidies to companies to encourage employment, why should this be abandoned in hard times?

 

[MrT]

How quickly will JLR be off to manufacture overseas when that's to their benefit though? Perhaps the bailout should be conditional on a guarantee that the manufacturing stays in the UK. As others have said, to me it just feels like Tata are looking for a kickback to stay in the country.

 

[Benzowner]

How quickly will JLR be off to manufacture overseas when that's to their benefit though? Perhaps the bailout should be conditional on a guarantee that the manufacturing stays in the UK. As others have said, to me it just feels like Tata are looking for a kickback to stay in the country.

It is all speculation at the moment, I am sure there will be severe strings attached to any loan, or it may even be a share in the company as they have done with the banks. Bearing in mind 15000 directly employed and countless other "subbies," £1,000,000,000 wont last long in benefits.

 

[Dieselman]

It does seem a trifle absurd that so soon after Tata buy JLR the British Taxpayer is being asked to bail them out.

If they were such a bad buy Tata should've paid Ford less for the company.

If HMG gives in to this blackmail then I think this will be the tip of the iceberg and the begging bowl will be proferred a number of times with no returns.

 

[Skintia99]

Is JLR worth saving? If it is who isn't Woolworths, MFI, etc

I suppose job losses will be a major factor

 

[vincenz]

I think we had this discussion a few weeks back, but no-one here has mentioned that its a loan.

For those of you who hadnt noticed we are in a credit crunch, where no-one is lending.

Under normal cirumstances JLR would approach a bank and borrow money, whereas at the moment it only seems the government is lending.

Put in simple terms, if JLR closes it would mean the loss of at least 50k jobs in the UK

As a taxpayer would you:

Prefer to lend money that will get paid back

or

Pay the benefits and job seekers allowance of the newly unemployed work force

 

[grober]

The problem with JLR is similar to the big three in the USA in that their product lines are all high fuel consumption vehicles. Even if they are propped up- is there a viable future market for the cars they produce or is a cash injection merely delaying the inevitable.

 

[gIzzE]

The government is going guaruntee a loan, not lend them the money.

When I first heard this I thought they were giving them the money and I was shocked, I thought why should we bail out a comapny that is selling a product that no ones wants anymore, escpecially when TATA, one of the worlds richest companies owns it and is reporting record profits.

As a payout, and to put it into perpective, if they had bailed Woolworths out it would have worked out at £16k per employee, bailing JLR works out at £66k per employee!

But it is not a payout, their order books and profits have been studied and they can actually make money and be quite profitable, however the banks are not lending and so they have asked for backing for the loan, it looks like it is worth doing and so they will probably step in.



I for one hate bail outs, a business usually dies for a reason, putting money in I think is the worst thing you can do, not only are you prolonging the agony that is enevitable but you are also killing off the competition that could well have a viable business, it bordered on unfair trading advantages to others.

But in this case, if they do genuinely have orders to fill were a proit can be made then I think it is the right thing to do, the fact one fo the richest overseas companies owns it is and they are not helping out is my only gripe.

 

[nick mercedes]

The problem with JLR is similar to the big three in the USA in that their product lines are all high fuel consumption vehicles. Even if they are propped up- is there a viable future market for the cars they produce or is a cash injection merely delaying the inevitable.

Can't the same be said about MB?

 

[vincenz]

As discuseed in the previous thread the direction of Land Rover Alone is the intent to go greener, the LRX concept signifies the direction of the company, they are the only manufacturer to offer a 45k mile carbon offset.

As for Jaguar, they were making money for the first part of this year, I appriciate they make big cars but I can't see everyone selling their Merc, BMW, Lexus etc to purchase small euro-boxes.

The deminishiment of these brand takes away the choice for the consumer.

 

[Dieselman]

Can't the same be said about MB?

No. MB has a broad spectrum of products, some of which are very fuel efficient and low pollution, thus sell well.
As a result MB aren't looking for Government subsidies.

 

[vincenz]

No. MB has a broad spectrum of products, some of which are very fuel efficient and low pollution, thus sell well.
As a result MB aren't looking for Government subsidies.

I think MB have the luxury of about 5 times the volume of sales than JLR hence their cash rich supplies.

If they had stuck with Chrysler then they would be in a very different position and it poses the question why did they merc with them in the first place.

 

[hawk20]

I think we had this discussion a few weeks back, but no-one here has mentioned that its a loan.

For those of you who hadnt noticed we are in a credit crunch, where no-one is lending.

Under normal cirumstances JLR would approach a bank and borrow money, whereas at the moment it only seems the government is lending.

Put in simple terms, if JLR closes it would mean the loss of at least 50k jobs in the UK

As a taxpayer would you:

Prefer to lend money that will get paid back

or

Pay the benefits and job seekers allowance of the newly unemployed work force

Are you really suggesting that the huge Tata empire could not borrow money if it wanted to? It could issue shares or bonds in India or raise money in Arab countries. And even British banks might lend to it on the security of some of its world-wide assets. It is huge and merely seeks a subsidy for a decision it regrets -at least temporarily.

How comic if the govt that wants to drive 4x4's and big engined cars off the road ends up subsidising the production of both.

 

[vincenz]

Are you really suggesting that the huge Tata empire could not borrow money if it wanted to? It could issue shares or bonds in India or raise money in Arab countries. And even British banks might lend to it on the security of some of its world-wide assets. It is huge and merely seeks a subsidy for a decision it regrets -at least temporarily.

How comic if the govt that wants to drive 4x4's and big engined cars off the road ends up subsidising the production of both.

Tata arent the company in question though are they?