Ratan Tata blasts UK government over Jaguar Land Rover

This is my raw copy filed to the Birmingham Post from India today, Tuesday, March 24. It can’t be published on the Post’s website because it’s broken. Normal service will be resumed soon.

An exasperated Ratan Tata, boss of the multi-billion Indian giant that owns Jaguar Land Rover, has broken his silence in the UK media to accuse the government of failing to value the manufacturing sector.

He also highlighted the potential cost to the company and its employees if the government does not come forward with the requested loan guarantees. He raised the prospect of JLR’s development projects being wound down, halting progress on a new sports roadster and leading to layoffs amongst development staff.

As the luxury car maker still waits for the government to agree to guarantee commercial loans to fund its working capital needs, the 71-year-old head of India’s largest company said the UK government didn’t seem to understand what it was his company was asking for.

Speaking in his office in the centre of Mumbai, the day after the launch of the Nano, dubbed the world’s cheapest car, Mr Tata said: “For some reason, our interactions with the government and members of the government seem to come back to ‘Tata is seeking a bailout for JLR. We’re really not but we have nowhere else to turn.

“The entire banking system has come to a halt in the UK, the US and India, but with one big difference. In the UK the banks have virtually been taken over by the government. They’ve bailed them out.

“When you go to the banks, they don’t say they won’t lend you the money. They set covenants you couldn’t possible accept and then say we couldn’t come to terms.

“All we’ve been asking is for the government to ask the banks they now own to give us a commercial credit on our balance sheet that will enable us to get through this period. £500m is what is required.”

Since the JLR crisis started in late 2008, the role of the Treasury and outside advisors has been called into question by observers who accuse them of having little understanding of the manufacturing sector.

Mr Tata said: “The government has advisers who seem to think the Tatas are trying to fob the problem onto the British government. The government thinks that because we’re approaching them for help, we must be asking for a bailout. But all we’re seeking is the governments facilitation of a commercial loan via the banks they own.”

JLR’s new product development programmes would be most at risk if the government failed to act, he said.

“We went into the downturn with a range of exciting projects in place, spanning new models and new hybrid and materials technology. It’s imperative we come out of the downturn with all these in place.

“But it’s likely that these projects would be the first to take the hit.”