Recently in Manufacturing Category

If Akio Toyoda, the president of Toyota, can make it to Washington to apologise to Congress, then where was Kraft boss Irene Rosenfeld last week when Kraft was hauled up before the House of Commons Business Select Committee by its Chair, the impressive Peter Luff MP?

Rosenfeld's decision to lie low and to effectively snub the Committee's proceedings meant that the hearing got off to an angry start - not surprisingly MPs were not impressed at being ignored by the Kraft boss.

Had Rosenfeld taken the opportunity to come out of hiding, it would have been the first sighting of her on this side of the Pond since Cadbury put the white flag up back in January.

Instead it was Kraft's head of corporate and legal affairs, Marc Firestone, who had to show up to take the rap, accompanied by two Cadbury execs. Not surprisingly, Firestone was dismissed by the politicians as a "PR man" and an "apologist" for the Kraft CEO. I almost felt sorry for him. Almost.

Without doubt confirmation today that Nissan plans to build the all electric 'Leaf' car at its Sunderland plant should be interpreted as good news for all concerned - the company, Nissan employees and for its part, the government. Hats off to Lord Mandelson then for whatever part the Business Secretary and his large team played securing the intended Nissan investment that I understand will also include a separate lithium-ion battery plant development near to the existing Sunderland facility.

Rumours abound in the auto blogospere that Nissan will imminently announce that the electric Leaf model will be produced in the UK at Nissan's Sunderland plant. The latter often features as one of the most productive plants in the world in global rankings.

This has yet to be confirmed by Nissan but an announcement may indeed be imminent. Nissan anyway intends to start selling the car in Europe later this year and will want to produce somewhere in Europe in the near future.

With Micra assembly shifting to India in the future, Sunderland will have the capacity to build Leaf cars.

After lengthy talks, Business Secretary Lord Mandelson today announced a 300 million Euro loan guarantee to GM Europe which aims to help secure the firm's operations in Britain and the rest of Europe.

The loan guarantee will be provided under the Automotive Assistance Programme (AAP) and will be provided alongside support from GM Europe's US parent and assistance from other European governments.

This is the first time the AAP has paid out on a substantial basis, following the failure of the government to deliver a prompt and acceptable support package to Jaguar Land Rover last year. JLR eventually found a private loan guarantee to access the EIB loan it wanted, on better terms than the UK government was prepared to offer.

Around 750 jobs will be cut by Toyota UK, it was announced today, with the bulk of the job losses at its Burnaston plant but with as many 150 jobs lost at its Deeside factory.

Toyota employs some 3,500 people at its two UK plants, and has said that all redundancies will be voluntary.

Staff will return to full-time working from April, after having had a 10% reduction in hours and pay for the past year. Toyota employs just under 550 staff at Deeside and a voluntary redundancy round will begin in the summer.

Toyota has also announced that a pay freeze will be imposed due to the "severe economic climate".

The announcement is no surprise to industry watchers and comes after the recent downturn in the industry and the recall turmoil which saw Toyota sales down.

Despite Conservative Party attempts to end the internal row over the future of Regional Development Agencies, confusion still reigns among some backbenchers at least over what really is the policy stance.

After weeks of confusion over policy, and contradictory statements by different shadow ministers, shadow local government secretary Caroline Spelman and shadow business secretary Ken Clarke wrote to Tory MPs this week attempting to clarify their position on the future of RDAs.

But one senior Tory backbencher was quoted this week in the MJ magazine as saying: 'It really isn't clear from this what the party's leadership really wants to do with RDAs. There is some talk of scrapping them, and then some talk of effectively retaining them. The policy is a bit of a mess and reflects the fact that there are, still, different opinions among the shadow Cabinet.'

The on-going confusion comes after months of damaging disagreement, which I have followed in my blogs here at the Birmingham Post.

The City's Takeover Panel is to look at whether Kraft misled workers and investors during its takeover battle for Cadbury.

The Panel on Takeovers and Mergers (as it's officially called) is looking into comments made by Kraft's top brass during the takeover battle, in particular relating to Cadbury's Somerdale factory in Keynsham.

As readers of this blog will be well aware, right from the start of the bid (indeed even in its initial takeover letter), Kraft bosses repeatedly stated that they believed the factory could be kept open. That was in stark contrast to Cadbury, which had said it would continue with long-running plans to close it down and shift jobs to Poland.

As soon as the ink was dry on the takeover agreement, Kraft executed a swift u-turn and said it would close the plant by 2011.

In the wake of the Cadbury takeover saga, Lord Mandelson last night finally appeared to recognise that there was a case for reforming the UK's lenient takeover rules so as to help long-term thinking and a range of stakeholders other than the short-term City speculators who cashed in so spectacularly in the Cadbury case.

The business secretary used his key Mansion House address in the City to say that firms' directors should act more like "stewards" and look after the firm's long-term interests rather than acting like "auctioneers" in selling out to the highest bidder.

The Takeover Panel started a review of the Takeover Code last month, after Mandelson had expressed concerns over the Kraft takeover, over which he admitted he had no power to act.

The Tory rhetoric for months now has been that RDAs will go. Remember Caroline Spelman (shadow communities secretary) in full flow at the Tory Party conference in Manchester last October? "Regionalism will go, lock, stock and barrel!" she exclaimed.

Other shadow ministers piled in, stating quite explicitly that RDAs outside London would go. Indeed, Spelman's predecessor, Eric Pickles, suggested that RDAs would get the 'Anne Boleyn' treatment. Ouch.

But, after a business backlash, Ken Clarke recently announced a 'review' of policy on RDAs - although this was later denied by Tory HQ. And now Tory leader David Cameron has sought to clarify the position. It was helpful - up to a point - but needs to go much further.

Despite repeated assurances that it would keep open the Cadbury Keynsham plant, Cadbury's new owner, Kraft, has done an abrupt volte-face and has confirmed plans to close the plant by 2011, with the loss of 400 jobs.

The plant had anyway been earmarked for closure by Cadbury but during the takeover war Kraft had pledged to keep it open, with the 'assurances' coming right from the top - from Kraft's CEO in fact.

With the ink barely dry on the takeover deal, Kraft has swiftly reneged on that promise. Of course, Kraft will say that they have only just had access to Cadbury's books and only now do they realise that £100 million has been spent on transferring production to Poland and that things were too far gone for them to row back.

That's not a very good defence. Kraft and Cadbury have spent a combined £400 million on advisors' fees for the takeover. Even a tiny slice of that spent on M&A research by Kraft's investment bankers would have told Kraft that production capacity was already in place in Poland.