The British motor industry continues to maintain its tendency towards instability, with workers at Ford's Land Rover subsidiary voting for industrial action over pay and MG Rover acknowledging plans to cease production for almost three weeks over Christmas in a further drive to reduce stocks.
While union leaders at Land Rover yesterday pulled back from an overall strike and instead opted foran overtime ban from next Monday, it all represents a further souring of the atmosphere at Land Rover's Solihull production centre, where earlier this year management faced resistance from workers over the introduction of more flexible working practices.
Solihull is already losing production of its small Freelander sports-utility to Ford's Jaguar plant at Halewood on Merseyside and, with Ford having a total of 110 plants worldwide, executives have been hinting that Solihull should not take its future for granted.
Meanwhile, MG Rover is to halt its production lines at Longbridge today until January 5th as part of a "stocktaking" exercise in advance of the Christmas holidays. Most other big car plants will not close for the holidays until early in Christmas week. The move comes less than a fortnight after MG Rover suspended production for three days in an earlier stock-reduction exercise.
However there is some good news for MG Rover. Its exports boomed in November as the relaunch of its European sales operations proved a rare success. Sales to continental Europe rose by a fifth in the month to 4,300 as Rover rebuilt its dealership network and took advantage of the strength of the euro. A strong euro makes its cars - with a sterling cost base - cheaper on the Continent.
However, the export increase was not enough to make up for a collapse in domestic sales. Rover's sales in western Europe fell 15.5 per cent when Britain was included, according to figures released by the Association of European automobile manufacturers. Here in Ireland, sales were 947 units for the year to November, compared with 1,713 for the same period last year.
Rod Ramsay, appointed four months ago to the new post of European operations director, is expecting overseas sales to grow further and would like to more than double exports to 100,000 a year in the medium term. -Financial Times Service