Government Consider LDV Life-Saver Loan
Thousands of jobs could potentially be spared at the van makers LDV if the government agree to a £5m bridging loan that would lead to further investment from overseas companies.
Although LDV and Citroen van leasing have been on the up recently, production at LDV has been put on hold since December last year as a result of reduced demand in the new van market. Workers there have also recently agreed to a pay cut of 10% and even a 3-day week in attempts to reduce outgoings at the plant. The originally request to the government from LDV was for £30m to keep production stable. This was not given buy the government initially but since LDV has reduced the amount they are asking for, the request is being reconsidered.
Over 800 jobs could be saved if the government decide to award the loan, as well as helping more than 6,000 workers are are affected along the supply chain. A number of investors from overseas are apparently looking to put money into the company if the government take action. These include one of the bidders who previously failed to secure Jaguar Land Rover, but also Mahindra and Mahindra, an Indian group who were in the running to purchase JLR and also a van leasing company a year ago but was eventually beaten by rival Asian conglomerate Tata.
Copies of the company accounts and business plans have been sent to the government and include a new concept for an ecological ‘green’ van. All the elements of the data will be looked into well by the government but the bosses at LDV seem optimistic. Erik Eberhardson, the chairman of LDV’s Russian owner Gaz, has already stated he is convinced the firm can be saved and a spokesman for LDV recently announced “This isn’t dead in the water. BERR has agreed to investigate all options, and the MBO team believe they have the best plan.”
