UK NEWS
CAR PRODUCTION CRASHES 60% AS DEMAND SLUMPS
Plans for a management buyout at van maker LDV have fallen through
By Martin Evans
THE number of new cars built in Britain last month plummeted by almost 60 per cent, official figures showed yesterday.
Manufacturers have been forced to slash production because of the dramatic slump in demand in the economic downturn.
Last month saw 59,777 cars roll off production lines, representing a 59 per cent fall on February last year.
Commercial vehicles suffered an even sharper fall - down 71.6 per cent on February 2008.
Unsold new cars worth more than £1billion have had to be stored at an enormous car park near Bristol.
Similar scenes are replicated at sites across Britain.
Car makers have been desperately trying to avoid mass redundancies and have in some cases temporarily halted all production or have moved to three or four-day weeks.
Yesterday's figures from the Society of Motor Manufacturers and Traders revealed that more than 300,000 vehicles have been lost from total vehicle output in the past 14 months.
The dismal figures came as Business Secretary Lord Mandelson claimed the Government was doing all it could to support the industry and insisted that car makers could survive if they took the right steps in the coming months.
He refused to be drawn on calls for the introduction of a "scrappage scheme" under which motorists would be paid to trade in their old cars for more eco-friendly models, a policy which has been introduced in many European countries.
Speaking before a visit to the Nissan car plant in Sunderland today, Lord Mandelson pointed out that the Government had created an assistance package "to make sure that these vital companies do not cut back and harm their capacity, both their plant, their research and their development, as well as their very skilled workforce."
But the industry is calling for more radical action. AA president Edmund King said: "These production figures show the urgent need for a boost to this vital industry.
"Car scrappage schemes in countries such as Germany are already having a positive effect on sales.
"The Government needs to decide now whether or not it will introduce a financial incentive to buy new cars because uncertainty means some potential buyers are putting off their purchasing decisions."
He added: "In an AA/Populus poll of 17,000 drivers, more than a quarter said that they would consider taking advantage of such a scheme.
"This would bring confidence back to the market and mean we would have safer, greener, cleaner cars on the roads."
Last night it emerged that plans for a management buyout at the troubled van maker LDV, which would save thousands of jobs, had fallen through.
The Birmingham based firm has not built anything since before Christmas.
But it was learned yesterday that it has been approached by two overseas companies.
SERVES THEM RIGHT
21.03.09, 6:29pm
Car companys have been ripping us off for years. Cars selling in the UK for thousands of pound more than the same cars are sold in Europe.
I have no sympathy for them.
• Posted by: John_Derby • Report Comment
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