Govt offers car industry lifeline

28/01/2009

The government has offered to guarantee £2.3 billion of loans for the British car industry.

The announcement follows severe job cuts at manufacturing plants across the country.

Employment secretary Peter Mandelson, said: "The government will guarantee £1.3 billion loans from the European Investment Bank to the car industry, as well as a further £1 billion in loans for investment in the greening of the car industry."

Mr Mandelson is also under pressure from workers' unions and troubled steel manufacturer Corus.

The steelmaker announced 3,500 jobs would be lost at its plants in the UK and said it needed government help.

"We have asked for a strategic fund for manufacturing of £13 billion, based on what the German government announced in October last year," a spokesperson from public services union Unite told Personnel Today.

"Keeping people in work is essential," she said. "These are companies that are viable and we need them in place when the upturn comes."

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