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8 May, 2000The Phoenix consortium will buy Rover cars from BMW and over 20,000 jobs will be saved.
GREAT BRITAIN: There was jubilation today, May 9, when trade unions learned that German automaker BMW, the parent company of Rover cars, agreed to sell its UK company to the Phoenix group. Over 20,000 jobs have thus been saved at the UK car manufacturer, as well as in the supply chain. Rover will continue as a volume car producer, and most of the company's jobs will be retained.
According to today's on-line news report by the Guardian, "Phoenix will now take responsibility for the development, production and distribution of Rover cars. Production of the Rover 75 and the MG brand will be shifted from Cowley, Oxford to Longbridge in Birmingham. Cowley will remain part of BMW, producing the new Mini which is due to be launched next year... The Phoenix deal will be financed by a loan of £200m from the US bank First Union, with a £500m 'credit' from BMW to help the consortium get Rover off the ground. A spokesman for the German firm said that BMW expected this money to be paid back. Phoenix itself will contribute a symbolic £10."
The UK government has reportedly said it would help to retrain and reskill workers who nevertheless lose their jobs at Longbridge.
The IMF-affiliated Transport and General Workers Union, the largest of the trade unions at Rover, issued a statement today welcoming the news of the agreement signed between Phoenix and BMW. Bill Morris, the T&G general secretary, said it was "excellent news for the workforce, the community and manufacturing... We will want to study the details of the deal as we have always known that there will be no painless solutions."
In another statement welcoming the successful bid by Phoenix, Roger Lyons, the general secretary of the Manufacturing, Science and Finance union, also an affiliate of the IMF, said that "this deal was only successful because of the hard work of the unions and the community of the West Midlands and proves that people power can achieve great things."
Search the IMF website under "Rover" for background information on the crisis at the UK car manufacturer.
According to today's on-line news report by the Guardian, "Phoenix will now take responsibility for the development, production and distribution of Rover cars. Production of the Rover 75 and the MG brand will be shifted from Cowley, Oxford to Longbridge in Birmingham. Cowley will remain part of BMW, producing the new Mini which is due to be launched next year... The Phoenix deal will be financed by a loan of £200m from the US bank First Union, with a £500m 'credit' from BMW to help the consortium get Rover off the ground. A spokesman for the German firm said that BMW expected this money to be paid back. Phoenix itself will contribute a symbolic £10."
The UK government has reportedly said it would help to retrain and reskill workers who nevertheless lose their jobs at Longbridge.
The IMF-affiliated Transport and General Workers Union, the largest of the trade unions at Rover, issued a statement today welcoming the news of the agreement signed between Phoenix and BMW. Bill Morris, the T&G general secretary, said it was "excellent news for the workforce, the community and manufacturing... We will want to study the details of the deal as we have always known that there will be no painless solutions."
In another statement welcoming the successful bid by Phoenix, Roger Lyons, the general secretary of the Manufacturing, Science and Finance union, also an affiliate of the IMF, said that "this deal was only successful because of the hard work of the unions and the community of the West Midlands and proves that people power can achieve great things."
Search the IMF website under "Rover" for background information on the crisis at the UK car manufacturer.