Tata in Talks with the UK Government for Car Loans

Tuesday 25 November 2008, 00:00 AM by Rishi

Tata Motors had acquired two major brands earlier this year, Jaguar and Land Rover. Jaguar and Land Rover have confirmed that they are in talks with the UK government for seeking a government loan of about £1bn loan in order to address issues that have come up due to the ongoing credit crisis in the country.

The company has asked the government to help the company which needs federal intervention to support the supply chain, investments in emission reduction technology and stimulate consumer demand. The firm owns plants in Solihull and Castle Bromwich. It has already gone on a 4-day week since August 2008 and extended voluntary retirement scheme to 600 workers.

Tata Group has witnessed a setback to its global expansion plans with Land Rover and Jaguar finding it tough to sail through the credit crisis. With the car sales slumping, it now looks like that Tata Motors made an expensive bargain this year. It had to launch $828M rights issue to fund the bridging loans it needed for the deal.

Back home also, Tata Motors is facing inventory pile up and had to shut down its Jamshedpur factory twice already. Investors and shareholders are looking at the group’s Chairman, Ratan Tata, for his expertise and experience to help the group succeed.

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