Jaguar Land Rover’s importance to the West Midlands has been spelled out as business minister Lord Mandelson considers a rescue package for the embattled UK car industry.
The Indian-owned company is critical for the future of the region, according to Mick Laverty, chief executive of development agency Advantage West Midlands.
And JLR chief executive David Smith urged the government to support the industry’s “jewel in the crown” with funds to help it to survive the recession and credit crisis.
Mr Laverty and Mr Smith were speaking at a round table meeting held at a Birmingham restaurant that was hosted by government manufacturing adviser Professor Lord Kumar Bhattacharyya, head of the Warwick Manufacturing Group.
He claimed that JLR would have “gone into thin air” in the present crisis had Ford sold it to private equity interests instead of Tata Motors of India earlier this year.
“Given another five years, JLR will be taking on BMW and Mercedes,” Lord Bhattacharayya said. “Already it is well on the way to doing it. It has the model range, the R&D and the exports. And it is British.”
Mr Laverty, who said the West Midlands cannot afford to see any more of its core automotive interests “chopped away”, stressed the lessons learned from the collapse of MG Rover when 50,000 jobs were at risk at Longbridge and in the ill-fated carmaker’s supply chain.
When MG Rover finally went down in 2005, AWM-backed diversification programmes had been so extensive that just 1,000 jobs and 11 companies were lost in the supply chain.
Jaguar and Land Rover, along with Warwick Manufacturing Group, are the principal partners in the £62 million Premium Automotive R&D (PARD) programme designed to help suppliers develop their skills, products, processes and market understanding to such a level as to be competitive globally.
“JLR is in the forefront of innovation and the improvement of workforce skills. We can ill-afford to lose that from the region,” Mr Laverty said. “I can’t underscore enough the importance of JLR to the West Midlands.”
JLR was also at the cutting edge with light weight vehicle research, with the company and AWM combining on a low carbon emissions programme. JLR has put £50 million into the project with AWM contributing £30 million.
“We need to make sure we position the West Midlands for coming out of the downturn, otherwise we will end up in an even worse position,” Mr Laverty said. “We have a critical mass of automotive technology in the region. But we lost Rover and we lost Peugeot. You cannot just chop away at it. It is important that we keep what we have got.
“We need world class brands that define us as a modern manufacturing region. If they are under threat that would diminish the West Midlands. It would have a massive impact on inward investment. The West Midlands has a fantastic past but an even more important future. It is about supporting something that is part of that future.”
Mr Laverty pointed to how the Advantage Transition Bridge Fund, launched to help suppliers in the Rover crisis, had been re-opened to offer aid during the current difficulties.