Tata Motors jobs will rise after UK announces loan

Economic Times

LONDON: Hopes of new jobs have risen in Britain again after the government announced a loan of 10 million pounds to Tata Motors to manufacture an
electric version of its Indica Vista car in this country.

But a source close to Tata Motors gave a measured response Tuesday, saying there will be "a few" new jobs - and they will be mostly in engineering.

The local media in Britain's Midlands region have expressed hopes of "hundreds of new jobs" at Tata Motors units after the Labour government ended months of delay last week to approve the loan.

Tata Motors will put in 25 million pounds into the venture, which will give Europe its first four-seater electric car with a range of 200 km and an electronically controlled top speed of 104 km per hour.

The loan - which was announced just as British joblessness touched a 14-year-high - was given to the Tata Motors' European Technical Centre (TMETC), based at the University of Warwick.

The Birmingham Post newspaper said the centre employs 180 people in the West Midlands, and job numbers could rise to 441 by 2014. Even more jobs would be created if Tata picks the West Midlands to assemble the new cars, it said.

But a source close to Tata Motors told IANS Tuesday the new jobs will not be in their hundreds.

"A few extra jobs will be created in engineering - but I can't see it being in the hundreds that are being talked about.

"If you look at the money, it is a minor figure - a small part of the pudding. But it's a good thing that this car's being produced for the Western market," the source told IANS.

However, the source confirmed that the new cars will be manufactured "with Jaguar Land Rover", the British marques that are owned by Tata Motors and have important manufacturing facilities in the midlands region.

Tata Motors is yet to give out details of the Indica Vista Electric Vehicle, prompting local speculation about where the facility will be located and what kind of facilities would be needed.

The Birmingham Post said: "It is hoped the move would create a significant number of jobs, both directly and through the supply chain."

Rachel Eade, operations manager at automotive supply chain support body Accelerate, said: "There is no doubt that this money will help the West Midlands continue the 'drive' and should hopefully place us at the forefront of green technology going forward."

Announcing the loan last week, Britain's Business Secretary (minister) Peter Mandelson said the loan will help in "securing and creating high value engineering jobs in the West Midlands".

"Today we are backing Tata as Tata backs Britain," he added.

Speculation about new jobs mounted in a week British unemployment hit a 14-year high at 2.47 million.

So far, Tata Motors has only said that the cars will be developed and manufactured in Britain and expressed appreciation for the government loan.