21/03 (17:09) CAR PRODUCTION CUT AT TWO ROVER PLANTS
By Alan Jones, Industrial Correspondent, PA News
Production at two of car giant Rover's main factories is being cut back and
holidays are being extended in the wake of the decision by German owners BMW
to sell the loss-making subsidiary, it was revealed today.
The slowdown at the plants in Longbridge, Birmingham and Cowley, Oxford, came
as the venture capitalists set to buy parts of Rover prepared to announce key
members of its management team.
Alchemy Partners is due to make an announcement tomorrow, as union leaders
are in Munich for fresh talks with BMW bosses.
The union officials will warn the German firm that it faces a campaign of
opposition to the break-up of Rover, which they now fear could cost 10,000
Meanwhile London-based German ambassador Hans Friedrich von Ploetz warned
against the row escalating into a political dispute that could cost billions
of pounds of investment in Britain.
The ambassador said it would be a pity if a commercial spat involving one car
firm drove off other investors.
"We are talking about one company. It is hard, yes, but we shouldn't enter
into a blame game, particularly not between nations."
Production of the flagship Rover 75 at Cowley is being slashed from 2,200 to
1,000 a week, while cuts of 20% are being made at Longbridge.
The night shift is being axed at Cowley, but none of the 3,500 workers are
being laid off.
The production cutback at Longbridge will mainly hit the Rover 25 and 45
models, of which 4,400 are usually built per week. The three-day Easter
shutdown at Longbridge is being extended to five days.
The decisions are believed to have been taken because of a predicted fall in
sales caused by the uncertain future of the Rover operation.
Rover produced more than 58,000 of its 75 models last year but sold only
Millionaire businessman John Hemming was today working on plans to create an
alternative consortium to bid for Rover.
The West Midlands-based e-commerce and computing entrepreneur wants to
compete with Alchemy, although he acknowledged that securing an alternative
package would be difficult.
"We are going through what figures we can and I am very interested in
creating an alternative bid," he said.
Hundreds of Rover shop stewards met today to be updated on the union campaign
against the sell-off, which includes a huge rally in Birmingham on April 1,
likely to be attended by tens of thousands of people.
Tony Woodley, chief negotiator for the Transport and General Workers Union,
said the rally would be the biggest event of its kind since the huge show of
support for the miners in the mid-1980s.
"The response we have had since deciding to hold this rally has been
unbelievable," he said.
Rover dealers are calling for compensation from BMW after investing massive
amounts of money in their business over the past two years.
The 294 dealers face an uncertain future and possible ruin because of plans
to cut production of Rover cars.
About 10,000 jobs depend on the dealerships and many of those are under
The dealers have written to Trade and Industry Secretary Stephen Byers, who
is due to meet BMW bosses in Munich on Thursday.
A BMW executive told a conference in the UK three weeks ago that Rover was
not for sale, according to a report tonight.
Gabriele Falco, managing director of BMW's UK sales region, issued a
reassurance that Rover would play a "critical role" in the group.
A video tape of the speech was shown on BBC TV news tonight, but BMW sources
said Mr Falco was not aware of the sell-off plans at the time.
The Amalgamated Engineering and Electrical Union said the speech proved that
BMW had tried to "hoodwink" everyone in Britain.
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