Britain’s biggest carmaker is in talks with Whitehall about a massive taxpayer support package as the coronavirus pandemic continues to wreak havoc across manufacturing industries.
Sky News has learnt that Jaguar Land Rover (JLR) has submitted the largest bespoke loan request of the COVID-19 crisis to ministers in recent weeks.
The plea is understood to have been for temporary state funding of well over £1bn, although a JLR spokesman described suggestions that it was as high as £2bn as “inaccurate and speculative”.
This weekend, the company said: ”Jaguar Land Rover [is] constantly in discussion with government on a whole range of matters relating to COVID and we will not discuss details which are confidential and private.”
A source close to JLR confirmed that a loan request had been lodged with the Department for Business, Energy and Industrial Strategy (BEIS) and said it was being considered by ministers.
Last weekend, The Sunday Times reported that the Indian-owned carmaker was among the companies in which taxpayers could ultimately take an equity stake as part of an extension of efforts to prevent key sectors of the economy collapsing.
JLR, a subsidiary of Tata Motors, is a giant of British industry, employing approximately 38,000 people.
It operates three main production sites: at Castle Bromwich and Solihull in the Midlands, and Halewood on Merseyside.
Approximately 20,000 of its employees have been furloughed under the government’s emergency wage subsidy programme, according to a spokesman, although about 2000 employees at the Solihull site returned to work this week.
Its cash position has been made far less robust by the pandemic, with the ratings agency Standard & Poor estimating recently that the company was burning through £1bn every month.
In April, it said total retail sales for the fourth quarter, ending 31 March, had slumped by almost 31% to 110,000 vehicles as a result of the pandemic.
JLR added that it had ended the financial year with cash and investments of £3.6bn, while it also had undrawn bank facilities of £1.9bn.
It was unclear this weekend how those figures had changed in the seven weeks since then.
Last summer, the company secured £500m of government-guaranteed loans in a deal with UK Export Finance.
That came just weeks after it reported a £3.6bn annual loss.
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