MG Rover signs deal with Chinese car maker

MG Rover has entered into a strategic relationship with China’s biggest car manufacturer, it emerged today.

The Birmingham-based car giant said the firm signed the development agreement with Shanghai Automotive Industry Corporation in a bid to increase production and secure a more certain future for its Longbridge site.

The firm’s parent company, Phoenix Venture Holdings, said the cooperation agreement would fund the development of new models and help exploit the global car market for the MG and Rover brands.

Kevin Howe, group chief executive of PVH, said the firm had decided to enter into the deal after recent discussions with several companies in China.

Mr Howe said: “We are delighted at the prospect of entering into a relationship with such a successful and respected partner, which will see a significant expansion in volumes of current and future products.”

Speaking after the announcement, MP Richard Burden, whose constituency includes the Longbridge car plant, said: “This is excellent news.

“It has also been clear for some time that securing a strategic partner is vitally important for the future.

“Such a partnership will enable MG Rover to compete effectively in the global car market and to invest in the development of future products.

“Longbridge is hugely significant for thousands of jobs in the Midlands and beyond.”

Saying the deal made commercial sense, Mr Burden added: “The British heritage of the Rover and MG Brands is a real asset in many expanding markets and maintaining that Britishness will be important to realising the company’s potential for the future.”

The deal was going before Chinese authorities to get approval.