UK: Minister signs UK loan guarantee for Ford
The paperwork for Ford’s loan and backing from the UK government was signed today during a visit by business minister, Mark Prisk, to Ford’s technical centre at Dunton, Essex.
The government is providing a GBP360m (US$542m) loan guarantee for Ford’s GBP450m loan from the European Investment Bank (EIB). The automaker is spending GBP1.5bn over the next five years to develop a new generation of environment friendly engines and vehicle technology.
The Dunton R&D site is one of four that will benefit from the investment which will also safeguard around 2,800 skilled jobs. The others are Ford’s manufacturing plants in Dagenham (diesel engines in a JV with PSA), Southampton (Transit light commercials) and Bridgend (engines) in South Wales. Ford no longer makes cars here in the UK.
The minister, accompanied by EIB vice president Simon Brooks, toured the laboratories where engineers put vehicles and engines through rigorous testing from extreme climates to crash simulators.
Prisk said: “Ford has an impressive track record in research and development. Its investment of GBP1.5bn over the next five years is a great opportunity to take the lead in developing low carbon manufacturing. This backing from the government will help to ensure the long term success of manufacturing in the UK and make sure we are at the forefront of new technologies.”
Brooks said: “The EIB is pleased to support Ford’s cutting-edge engine research and development in Dunton and Dagenham and the company’s upgrading of manufacturing operations in Bridgend, Southampton and Dagenham, in particular through the European Clean Transport Facility. A new generation of low-emission engines and more fuel-efficient vehicles will develop new skills and innovation across the United Kingdom, and these new vehicles will make a significant contribution to combating climate change.”
Ford of Britain chairman Joe Greenwell, said: "This EIB loan, and the loan guarantee from the UK government, will help to unlock up to GBP1.5bn in low carbon and environmentally friendly engine and vehicle technology investment over the next five years. This is a testament to the skills and capabilities of our UK workforce and demonstrates the scale of our commitment to Britain."
Ford said currently accounts for 29% of the UK’s automotive sector research and development.
The UK projects to be supported include research and development for commercial vehicles such as the Transit and Connect vans and the development of low carbon emission diesel and petrol engines. This includes investment in production facilities for new lower carbon engines in Bridgend. Currently, 25% of all Ford engines worldwide and over 50% of all its diesel engines are made in the UK.
The European Investment Bank funding makes use of the European Clean Transport Facility, a dedicated EUR 4bn annual package approved by European Union finance ministers in December 2008, that support investments targeting research, development and innovation in the areas of emissions reduction and energy efficiency in the European transport industry . In this way automotive companies of all sizes can continue crucial research, development and innovation investment using cheaper and longer-term loans backed by the 27 EU member states.