Reports have again emerged that Jaguar Land Rover is in talks with the UK Government to secure a massive cash injection because of the coronavirus crisis.
A report in the Financial Times has claimed the Coventry car maker is one of six large companies in advanced talks with the government over bailout cash.
The report says Britain’s biggest car maker is one of six ‘strategically important’ businesses in talks over emergency funding under a new scheme dubbed ‘Project Birch’.
The discussions are reported to be taking place because Jaguar Land Rover and the other companies involved were not eligible to borrow cash under the existing rescue loan programmes.
According to the FT some of the loans could see the Government take an equity stake in the businesses, which also include steel makers.
A Jaguar Land Rover spokesman told the FT that they are in ‘regular discussion’ with the Government.
Towards the end of May Sky News reported Jaguar Land Rover was in talks with the Government to secure a loan of more than £1 billion as it seeks to get back on track following the coronavirus pandemic.
According to Sky News the company has submitted the largest bespoke loan request of the Covid-19 crisis to ministers .
At the time Jaguar Land Rover remained tight-lipped on the matter but did say it is “constantly in discussion with government”.
In a statement the company said: “Jaguar Land Rover [is] constantly in discussion with government on a whole range of matters relating to Covid and we will not discuss details which are confidential and private.’’
The Department for Business is yet to comment about any Jaguar Land Rover loan request.
In the wake of the May Sky News report CoventryLive considered further speculation that the Government could take a stake in Jaguar Land Rover.
It has been suggested that the company’s owners Tata are not keen on the prospect, but if the Government is prepared to help the car maker with a huge cash injection might it prefer for it to be an investment rather than a loan?
Even if Tata was reluctant about the Government taking a stake, might it ultimately agree in order to get Jaguar Land Rover back on track following the coronavirus pandemic?
Speaking in May automotive expert Dr Charles Tennant said: “The Conservative Government will now have to tread the tightrope very carefully in terms of potentially picking so-called winners and setting an expensive precedent.
“Our government need to be very careful now as there may be a queue of takers: potentially from McLaren, Vauxhall, Nissan, BMW and even the aerospace sector such as Rolls Royce.”