British Leyland

HC Deb 12 July 1982 vol 27 cc629-31

5. Mr. Hal Miller

asked the Secretary of State for Industry whether he is satisfied with the progress being made by British Leyland.

The Minister of State, Department of Industry (Mr. Norman Lamont)

Yes. As Sir Michael Edwardes said at BL's annual general meeting, the company is on course to achieve the main financial targets set for 1982 in its current corporate plan.

Mr. Miller

Does my hon. Friend agree that, although the reduction of £100 million in the losses of BL's car division last year is to be welcomed, BL's progress towards break-even is threatened by the heavy over-supply of cars on the market, which is estimated as being 30 per cent. in excess of demand? Is it not time to take account of the remarks of the newly elected president of the SMMT and to consider afresh the possibility of relaxing hire purchase restrictions on motor vehicles to bring them into line with those on other goods, to take note of the tariff disparities with Spain and to do something about parallel imports?

Mr. Lamont

My hon. Friend has raised several major problems. We shall certainly take into account the comments of the new president of the SMMT.

With regard to overcapacity in the industry, import penetration is approaching 60 per cent. and car production is at its lowest level for 24 years, so it is not obvious that there is any vast overcapacity in the United Kingdom.

I agree that Spanish imports represent a serious problem. It arises out of the current position of Spain vis-a-vis the Community, and it is being considered in the context of negotiations for Spain's accession to the Community.

Mr. Orme

In view of the figures that the Minister has given and the effect upon the United Kingdom motor industry, is it not time that the Government made a statement about the Nissan investment? Is he aware that there is speculation in the press about a plan B, but that the House has been given no information about this? Is it not time that the Government made a statement about the negotiations?

Mr. Lamont

No, I do not believe that it is. Moreover, I cannot imagine that the right hon. Gentleman thinks that that is a remotely helpful question. We are in negotiation with the Nissan Motor Company, representatives of which will be coming to this country very shortly. It would be both premature and foolish for the Government, in the process of negotiation, to make a statement to the House at this point.

Mr. Richard Page

If the Nissan project does not go ahead, does my hon. Friend regard BL's progress as sufficient to halt the penetration of our home car market by foreign imports?

Mr. Lamont

The rise in imports this year has been disappointing. At the same time, there have been notable advances by BL. In the first quarter of this year BL sales rose by 6 per cent. and BL exports across the board rose by 23 per cent. There have also been some remarkable advances in productivity. We believe that the results achieved by BL are consistent with the targets set for it.

Mr. Dalyell

Following the courteous hearing given to me by the Minister and his senior civil servant, Sir Peter Carey, relating to the dispersal of machinery from Bathgate, will he ask a senior official from the Department to visit Bathgate to see at first hand the industrial calamity that results from the widespread sale of public assets of this kind when machinery goes not only to Marshall of Gainsborough but to other firms at knockdown prices?

Mr. Lamont

I have already written to the hon. Gentleman about the talk that we had. We are well aware of the deep problems caused by redundancies and closures in his constituency. On the last point, the hon. Gentleman will know that the Public Accounts Committee has been considering this aspect, and a report is expected shortly.