Tata Motors seeking UK government loan for Jaguar Land Rover
23 December 2008
Tata Motors has sought loans from the British government for the working capital needs of Jaguar Land Rover, company sources said today.
The request comes after a statement issued by UK business secretary Lord Mandelson that the government would help where it can but it does not have an open cheque book which can be used to bail out any industry.
Tata Motors is reported to have made it clear that it is only looking for a government loan as banks have stopped lending and there is no other way of getting affordable loans.
Tata Motors also said it is only looking for a bridge loans until such time that it can arrange funds from banks or the market.
With several of UK's car plants closed, the Society for Motor Manufacturers and Traders (SMMT) in the UK is also seeking a similar arrangement by the government, either as loan at commercial rates or guarantees for bank loans.
Reports also said the government is working with the industry to put together a package for the ailing motor industry before the Christmas break.
The industry insists that it cannot restart the stalled market without an improvement in liquidity as the credit problem has affected everyone, including car makers, dealers, component suppliers and consumers.