British Leyland (Hansard, 5 June 1985)

§ 5. Mr. Strang
asked the Secretary of State for Trade and Industry if he will make a statement on the Government's future commitment to British Leyland.

§ Mr. Tebbit
The Government remain committed to the restoration of BL to commercial viability.

§ Mr. Strang
Is the Secretary of State prepared to go down in history as the saboteur of Britain's only major indigenous motor manufacturer? Does he admit the accuracy of the report in today's Financial Times that Austin Rover is to be forced to rely on Honda engines, which, combined with the privatisation of Jaguar and the proposed privatisation of Unipart, make industrial sense only if the Government are planning to facilitate the eventual takeover of BL by Honda or some other multinational?

§ Mr. Tebbit
The answer to the hon. Gentleman's first question is no. The answer to his point about the article in the Financial Times is that I have no intention of commenting upon an article that is a sort of bouillabaisse — a fishy stew; a mixture of truth, half-truth, inaccuracy and downright untruth.

§ Mr. Spencer
Before my right hon. Friend commits further sums of public money to BL, will he fully satisfy himself that it has learnt the first rule of business—that the customer is always right?

§ Mr. Tebbit
Yes; and I am of the opinion that that lesson has been well learnt.

§ Mr. Williams
Does the Minister realise that if he were as ready with decisions as he always is with insults, BL would not be waiting after six months and the British Steel Corporation would not be waiting after 11 months for decisions about their futures? Does he accept that this inexcusable dither and delay by himself and his Department is damaging BL and that the uncertainty is stimulating and provoking the very type of speculation —I hope false—that we have seen in the newspaper that used to employ the right hon. Gentleman? The standards there have not changed at all. Is not this speculation destroying the morale that has been carefully built up during BL's recovery period? Is the right hon. Gentleman aware that if there is any truth in the proposition that BL is to be forced to drop engine production and to buy Japanese engines, so giving up high value skilled work in exchange for low value Meccano assembly operations, that will trigger off a massive storm not only in the west midlands but throughout the car and components industries?

§ Mr. Tebbit
I have to say of my employer of some 30 or 40 years ago that the standards seem to have gone down as the pay has gone up. I take note of what the right hon. Gentleman says. However, although we received the original corporate plan for BL some months ago, at a late stage in our consideration of the plan, BL and Honda put to the Government some important proposals for collaborative projects. That changed the nature of the corporate plan. It is not unreasonable that we should have given extremely close consideration to those proposals. We are now nearing completion of our scrutiny of the corporate plan and the proposed further collaborative arrangements with Honda. I hope that I shall be able to announce our conclusions shortly.

§ Mr. Forth
Can my right hon. Friend assure the House that, at this stage in his deliberations, he fully appreciates the crucial importance of the continuation of engine production by motor manufacturers, such as the Austin-Rover group, to their viability as full-scale manufacturers, and the key importance to the west midlands of that production?

§ Mr. Tebbit
I fully undertstand what my hon. Friend says, but, having been firm in what I said to the right hon. Member for Swansea, West (Mr. Williams) about the fact that I shall announce our conclusions shortly, it would be wrong if I commented by way of half statements on bits and pieces of the proposals before us.

§ Mr. Wrigglesworth
Even in advance of that statement, can the Secretary of State agree that it is vital for the whole of the British industry and economy that we retain the volume production of cars at British Leyland? Will he give a pledge that he will do everything in his power to sustain the volume production of cars, which can be done only if engine production is continued?

§ Mr. Tebbit
I am anxious to ensure the success of BL from every point of view. I am conscious of the fact that motor cars that appear to the consumer to be British have had some foreign production. For example, on average, about half of a Ford motor car is British, about a third of a GM Vauxhall is British, and over 90 per cent, of a BL car is British. Therefore, we have a clear interest in that and also in the fact that BL is a British car exporter, alongside Jaguar, although on a different scale. We are acutely conscious of BL's importance in the British industrial scene.

§ 6. Mr. Dalyell
asked the Secretary of State for Trade and Industry what discussions he has had with BL on the future of the commercial vehicles industry.

§ Mr. Norman Lamont
The prospects of BL's commercial vehicles business are covered in the company's annual corporate plan.

§ Mr. Dalyell
What can Her Majesty's Government do to assist the continuation of commercial vehicle manufacture in Bathgate?

§ Mr. Lamont
As the hon. Gentleman knows, the decision about Bathgate has been made and, unfortunately, that decision will not be changed. As regards assistance to the area and alternative uses for the plant, my right hon. Friend the Secretary of State for Scotland is obviously prepared to view sympathetically applications for alternative use of the plant, or bits of it. As the hon. Gentleman knows, the travel-to-work area is a development area and therefore qualifies for the highest level of assistance.