Longbridge has drastically cut its annual losses from over £12 million to just £392,000 as the rebirth of Birmingham’s most famous factory gathers pace. Results for MG Motor UK for 2010 showed that sales of parts to China had helped slash cash losses at the car firm, which launched production of the MG6, its first all-new MG, in April.
Meanwhile, a capital injection of £7 million from the Chinese parent company also helped to bolster the firm’s financial status, the report revealed. The vastly improved results came as sales of Longbridge’s first all-new MG for 16 years generate increasing revenues for the Birmingham factory following the relaunch of volume production.
The MG6 generated over £3 million of business in its first two weeks in showrooms, leaving many buyers facing a waiting list of up to six weeks for customized vehicles.
Director Hao Wang said in the annual report for 2010: “The company generated a turnover of £11,385,000 (2009 £6,887,000) in 2010. The increase in turnover was mainly due to the increased level of sales of automotive parts to group companies in China. The loss after tax amounted to £392,000 (2009 £12,737,000). The significant reduction was due to the increased sale of parts and service.”
The recent launch of the MG6, which is 80 per cent built in China and shipped to Birmingham for final assembly, is set to take annual car production at Longbridge into the thousands rather than the hundreds.
Bosses at MG Motor UK are now optimistic 2011 will see the firm move into profit.
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