Talks between Jaguar Land Rover, Tata Steel and the British government have reportedly ended, leaving both companies in need of private financing in order to overcome these difficult times.
In the end, it seems that JLR failed to qualify for taxpayer support, according to the Financial Times, as the carmaker was unwilling to accept certain levels of decarbonization, which would have resulted in an accelerated timeline for vehicle electrification and the phasing out of diesel cars.
This bailout plan, also known as “Project Birch” had been previously authorized by the UK Finance Minister Rishi Sunak back in May. The report, citing a source familiar with the matter, also stated that the funding scheme became infeasible for Tata because it imposed strict conditions with regards to lending, reports Autonews Europe.
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“Tata Steel remains in ongoing and constructive talks with the UK Government on areas of potential support,” said Tata Steel in an emailed statement.
The British carmaker previously increased its savings target for 2020 to 2.5 billion pounds ($3.3 billion) after registering a 413 million pound pre-tax loss in the last quarter of this year. They also entered into agreements with lenders in China for a 5 billion yuan ($704.5 million) loan – JLR’s first ever debt financing in China. Going forward, the company will welcome former Renault CEO Thierry Bollore as its new boss on September 10th.
Both Jaguar Land Rover and Tata Steel are owned by the Tata Group, which bought JLR from Ford back in 2008.
