MG means business at Longbridge
Reuters, The Associated Press
WEDNESDAY, FEBRUARY 22, 2006
LONDON Nanjing Automobile of China, which trumped a bid by Shanghai Automotive last year to buy MG Rover out of bankruptcy, signed a 33- year lease Wednesday for the factory site of the former British carmaker and said it would begin producing sports cars at the plant next year.
The future of the Longbridge factory in central England had been in doubt since it was closed in April with the loss of 5,000 to 6,000 jobs when MG Rover, the last major British car manufacturer, declared bankruptcy.
Nanjing surprised the automobile industry when it paid £53 million, or $92 million, to buy MG Rover, which had debts of £1.4 billion, in July. It is one of several Chinese carmakers, including Geely Automobile Holdings and Chery Automotive, that are taking steps to follow Toyota Motor of Japan and Hyundai Motor of South Korea in becoming global brands.
Nanjing said it planned to employ up to 1,000 workers and begin production of the MGTF sports car next year.
The deal signed Wednesday was better than unions and local lawmakers had hoped for. The owner of the site, St. Modwen Properties, had suggested last week that Nanjing would only sign another six-month, short-term lease while it considered whether to restart production.
However, the lease, with rent pegged at around £1.8 million a year, does incorporate a six-month break clause in case Nanjing is unable to confirm a viable long-term future for the site.
"We move forward according to our original plan," Wang Hongbiao, the Nanjing chairman, said through an interpreter at a news conference. "Next year we will produce a sports car here. After that, we will produce a car which will make profits."
But Richard Burden, a lawmaker with the ruling Labour Party who represents the Birmingham area, sounded a note of caution.
"My welcome is tempered by realism, first of all about what is being proposed," Burden said. "This is not mass car production at Longbridge."
Dave Osborne, a spokesman for the Transport and General Workers' Union, said that union officials were told that Nanjing plans to produce 100,000 vehicles each year.
Unions had been unhappy when Nanjing won the bid for Rover because it appeared to offer worse prospects for resuming full-scale production at Longbridge than rival offers.
Some pictures of the above event:
Longbridge cars on sale in 2007
The UK chairman of the firm that bought Rover's Longbridge plant has said that Nanjing Auto is about to restart car-making in Birmingham.
The BBC has learned that cars could go on sale from July 2007 and Chinese firm Nanjing has said it is keen to re-employ ex-Longbridge workers.
Two production lines remain intact, including the MGTF sports car line.
Some Midland firms have been approached to make parts for Nanjing and more orders are expected.
Speaking through an interpreter, Nanjing's UK chairman Wang Hongbiao told the BBC: "We are going to resume production of MGTF here.
"Maybe in the near future... we will launch some new models to the market."
Nanjing announced in February that it had renewed its lease on the Longbridge plant for a further 33 years and wanted to resume car production. It also has a get-out clause allowing it to walk away.
200 initial jobs
The firm has previously said it could employ 1,000 people. It later changed that number to 600.
On Tuesday, Nanjing said there would be 200 jobs in the first year of production.
The company said the more cars it sells the more jobs it will create. A recruitment drive to find the initial workforce will take place at the end of this year.
Nanjing's acquisition of MG Rover only included the rights to use the MG brand. The Rover brand is still owned by Rover Group's former parent BMW. MG Rover went bust in 2005, at a cost of about 6,000 jobs, and was then bought by Nanjing for £50m ($86m).
some pics of the longbridge plant, when annouced closing b4
This is very exciting. I predict that if Nanjing nurture the business carefully then ultimately they will one day need to make a lot of cars in Europe (due to tarrif restrictions etc). Longbridge is one of the most famous plants in the world and can perform that function well, but only if it has the support of a strong business like the one Nanjing is trying to build in China. Everyone can be happy!
NAC-MG mean business at Longbridge
"What, producing old models that public never wanted in the first place?"
Thought I'd get it in before a certain other member! Hehe!
Excellent news, old chap! Good to see things moving, or ready to start at least!
Interesting to read some of the text on 28DL too. One of the guerilla-photographers noted engines on testbeds in the "Flight Shed" with notes dated that day. Evidence that that NAC-MG are using Longbridge to develop the G/N-series engines, in addition to preparing for TF and 7Z production.
Talk to us, NAC tells MG enthusiasts
Days after announcing that production of the historic MG marque was to recommence at Longbridge, Nanjing Automotive Corporation (NAC) is inviting fans to speak with representatives of the manufacturer in a specially-arranged web discussion.
The one-hour discussion will start at 11AM on Thursday 8th February 2007 on mg-rover.org – with MG enthusiasts invited to submit questions to Sales and Franchising Director Stephen Cox in the United Kingdom and Quality Director Paul Stowe in China.
Topics up for debate include the construction status of NAC plants in the United Kingdom and China; partnerships; product validation, reliability and durability information; and NAC’s timetable for 2007.
Paul says: “From the outset, NAC has recognised the positive and pivotal role that enthusiasts have played in the development of the MG brand, ever since Cecil Kimber’s very first car left the factory in 1924.
"Today, NAC not only recognises the historical importance and significance of MG enthusiasts, but is keen to build upon established links with MG enthusiasts worldwide. Stephen and I very much look forward to re-engaging via webchat, with fellow enthusiasts who share our commitment and passion for MG.”
Paul’s Longbridge based colleague Stephen Cox, says: “With only a few months to go until car assembly recommences at Longbridge and the opening of our new production facilities in China, there’s never been a better time to be an MG enthusiast.
Paul and I are excited about getting together with our fellow enthusiasts online, answering their questions and of course,
Cood move by Nanjing ;)
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