I’ve just come out of a press briefing at the Society of Motor Manufacturers and Traders in central London.
Paul Everett, chief executive of the SMMT, arrived, hot foot, from his meeting with Business Secretary Lord Mandelson.
Although Everett was clearly keen not to ruffle Lord M’s ermine, it was obvious that the SMMT wanted to press the emergency button on the issue of credit.
The car industry needs access to credit – both for car buyers and for the industry itself - and the SMMT said it was ‘underlining the urgency of the situation’.
‘The credit issue is very important and at the top of our list. We need to use it as a bridge across the period of the recession and make sure we still have the industrial capacity to take advantage of the upturn’ Everett said.
It seems that Lord M has now taken this on board – possibly in light of the reaction to the rather modest medium and long-term aid package unveiled yesterday.
However, Lord M and his officials did point out that only banks could access the Bank of England bailout funds, and not the finance arms of car companies. So Government officials are now looking into a way of short-circuiting this hurdle.
The SMMT said it was also going to put together a dossier for the Government on the effectiveness of the ‘scrappage’ schemes popular on the continent. I’m not sure, though, that the PM will be too keen on offering substantial sums to drivers who scrap their old banger and buy a new car.
Ultimately, I can’t help feeling that when the car industry comes calling, the Labour party climbs under the table.
After all, it was an ill-advised Labour government-encouraged merger created BL/Rover in 1968. And it has collapsed three times (1974, 2000, 2005) while Labour has been in power.
With that history, it’s understandable if Labour is very nervous about the car industry. But unless access to credit is unlocked pretty quickly, Labour will again find the UK car industry crumbling under its watch.