Government confirms talks with Jaguar Land Rover
Despite Jaguar Land Rover not being one of the more prominent car manufacturers to appeal to the UK government for assistance, rumours are circulating today that the company is in talks with Lord Mandelson about a potential bailout package funded by the taxpayer. If these rumours are correct it would seem highly likely that the hand of assistance will be extended to many more car manufacturers in the UK at great cost to the UK taxpayer.
While the terms of any such deal have yet to be confirmed it would be safe to assume there would be a significant financial injection into the industry and possible tax benefits in the short to medium term. However, some observers are suggesting that the ever-growing bank of unsold vehicles will take years to sell down and quite how the UK government can assist in the short to medium term remains to be seen.
It will be interesting to see exactly what the companies have asked for and what the government could potentially deliver as any such deal with need to be structured in such a way as to give taxpayers the potential for an investment return in due course.
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