Land Rover...

wymondham

Now I'm really losing the plot ... why is the UK Governement (ie us) providing funding for an Indian owned car manufacturer to develop a new car?

http://news.bbc.co.uk/1/hi/business/7937196.stm

Cannon_Fodder

A sweetner to keep them from making sweeping redundancies?

Rochdale_Pioneers

wymondham wrote: »

Now I'm really losing the plot ... why is the UK Governement (ie us) providing funding for an Indian owned car manufacturer to develop a new car?

http://news.bbc.co.uk/1/hi/business/7937196.stm

Its called state subsidy, and its how the car industry works in most parts of the world.

lostinrates

Rochdale_Pioneers wrote: »

Its called state subsidy, and its how the car industry works in most parts of the world.

Indeed this is a global problem, with a global solution: fewer, less damaging, longer lasting cars and an acceptance that consumption of cars is not a guiltless pleasure.

wymondham

Rochdale_Pioneers wrote: »

Its called state subsidy, and its how the car industry works in most parts of the world.

... then that makes it an unviable company if it can't stand on it's own??

Why does the car industry get state help, but say.. a small steel works at the end of my road does not ?

JasonLVC

Rochdale_Pioneers wrote: »

Its called state subsidy, and its how the car industry works in most parts of the world.

Indeed state subsidies are common place and help keep employers sweet enough to employ folks and keep them in jobs.

It is an odd choice of business to subsidise though. Land Rover, they only make four cars and all of them are 4x4's which "everyone" hates and which the government has taxed off the road through increments in the Co2 banding of car tax.

I realise LR are wanting to develop greener and cleaner vehicles (and even the current range are not exactly gas guzzlers), but having whipped up enough bad publicity for the company by making them out as dirty and needless beasts, presenting them as 'toffs' cars and cars that clog up London roads - to then invest in them developing more seem at odds with the message.

Why not give grants to Honda who make green cars now, why not Nissan - even if LR made the greenest car in the world they are a small volume manufacturer and for real green impact you'd need to target the mass market, not a sector which is 'exclusive and small' to put it mildly.

RP - this isn't a dig at Brown or subsidies, it is just a grant that I find odd in terms of the wider agenda of green house gasses, etc. So we save 3,000 jobs today but then restrict LR's sales market (assuming it ever recovers).

As a side note, the sale of LR from Ford to Tata included product development up until 2013 - so this grant must be for vehicle beyond that period.

(ps. I'm not stalking you, my Dad works for LR so is a subject I have a particular view on).

Pennywise

I thought state subsidies were banned by the EU?

I also thought that there were already attractive tax incentives for research and development.

Anyway, I think we all know that the money has just been "packaged" as research and given green credentials for political purposes. It will probably just go into the pot and help cover LR's general overheads for a few weeks.

I don't suppose the LR plant is in a marginal Labour constituency is it?

itsnever2lateisit?

I assume this £27m is towards the LRX, which IIRC is a hybrid. Drop in ocean really, a vehicle like that would probably cost 4-500m to develop. More likely politics at play as this vehicle, should it make production, will be built in Halewood, where the Jaguar x-type is currently made, and is 8 years old, so near the end of its natural.

Being a hybrid I guess it gets round EU competition rules, as a 'green' investment

http://www.timesonline.co.uk/tol/driving/new_car_reviews/article3287735.ece

Eskimo12345

JasonLVC wrote: »

It is an odd choice of business to subsidise though. Land Rover, they only make four cars and all of them are 4x4's which "everyone" hates and which the government has taxed off the road through increments in the Co2 banding of car tax.

Five. They make five.

Range Rover, Range Rover Sport, Discovery 3, Freelander 2 and Defender.

Pennywise wrote: »

I don't suppose the LR plant is in a marginal Labour constituency is it?

There's Halewood in Liverpool where they build Freelander 2, and the engineering centres in Coventry and Gaydon. So quite a spread.

dealsearcher

I heard some person on the news saying the government should provide funding for banks to provide loans to buy these new cars. Trouble is no one wants to buy new cars now so they wouldn't want a loan for one would they? Why would anyone want to buy a new car now when they depreciate so fast when they have a perfectly good car already?

Rochdale_Pioneers

Pennywise wrote: »

I thought state subsidies were banned by the EU?

I'm sure they are. Thats never stopped the French doing it though.