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MG Rover confident on China deal
(Xinhua)
Updated: 2004-11-24 10:15

 China's biggest automaker Shanghai Automotive Industry Corporation is expected to take a 70-percent stake in loss-making MG Rover, Britain's last volume carmaker, under a proposal that awaits Chinese Government approval.

UK Workers assemble a Rover car on the assembly line at the Rover Longbridge plant near Birmingham.

The deal has raised questions about the future of MG's main plant, Longbridge, near Birmingham in the West Midlands. The plant assembles the Rover 25, 45 and 75 models plus the MG series of performance cars.

But MG chairman John Tower says although the production is shifted to another country, car workers' jobs will remain at Longbridge. Towers says workers at Longbridge were "very happy" with the proposed joint venture.

Up to one billion pounds or US$1.86 billion is expected to be invested in new MG Rover models in return for Shanghai Auto's clear majority stake in the company, formerly owned by German automaker BMW.

Industry analysts believe that new MG Rover models could boost output at Longbridge from 110,000 a year to almost 200,000. But some experts speculate that Shanghai Auto could eventually decide to produce all the vehicles itself.

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