Car workers on tenterhooks as MG Rover talks 'stall'

Thousands of workers at car giant MG Rover are waiting for news today about crucial talks on a joint venture with a proposed Chinese partner after the revelation that the negotiations had “stalled”.

Thousands of workers at car giant MG Rover are waiting for news today about crucial talks on a joint venture with a proposed Chinese partner after the revelation that the negotiations had “stalled”.

A team of senior officials from the Department of Trade and Industry have been in China since last Friday trying to secure a deal between the UK firm and the state-owned Shanghai Automotive Industrial Corporation (SAIC).

Sources close to the talks said last night that they had stalled and that MG Rover’s finances were worse than SAIC or the UK government had expected.

The development threw fresh doubts over the deal being completed and raised fears about the future of the UK’s last volume car maker.

A government offer of a bridging loan of £100m (€146m) remained on the table in a bid to keep MG Rover solvent while negotiations continued.

Union officials were anxiously waiting for new from Shanghai and remained hopeful that the negotiations would continue.

Tony Woodley, General Secretary of the Transport and General Workers Union has said that the partnership was the “only show in town” for MG Rover, which employs 6,000 workers at its factory in Longbridge, Birmingham.

Thousands of other jobs across the West Midlands depends on the survival of MG Rover which has been saying for years that it needed a partner to develop new cars.

Ministers have started preparing for a possible collapse of the talks by promising to give financial aid to workers if they become redundant.

Pressure was building on the directors of MG Rover’s parent firm Phoenix Venture Holdings to move the negotiations forward.

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