UK [updated 18:00BST 18.10.06]: TVR reneges on UK production agreement

By just-auto.com editorial team | 18 October 2006

Russian-owned specialist sports car company TVR has reneged on an agreement to keep production in a British seaside town.

The automaker is to cease UK production with the loss of 260 jobs at its factory in Blackpool, Lancashire.

TVR, which was bought by young Russian tycoon Nikolai Smolensky in 2004, told just-auto it was now in consultation with unions over redundancies.

Speculation that the firm would give up on UK production had been growing since the start of this year, yet only last month TVR said it would be staying in Blackpool, firstly at its current site in Bispham until 2008, and then at a new permanent home at Blackpool Business Park.

In April the firm temporarily stood down 71 members of staff due to flagging demand, which was said to have fallen from 12 cars a week to just two.

The company confirmed in a statement that it is now planning to 'outsource' all production formerly carried out at the Blackpool factory, and agreements are being finalised for the 2007 run of Tuscan, Tuscan Convertible and Sagaris to be produced in Europe with fully-built powertrains due to be produced elsewhere in the UK.

TVR owner Nikolai Smolenski said: "We are extremely sorry that, after a period of uncertainty and raised hopes that we could not continue production ourselves in Blackpool, we have had to make this decision. 

"We need to secure the future of the company and move it forward. I am afraid we see no other way to do so."

TVR is negotiating with staff and the Transport & General Workers Union on redundancy, with 260 staff employed at its Bispham, Blackpool premises.   

The sports car maker plans to continue with all current arrangements for the supply of cars and parts, with discussions ongoing with suppliers about future relationships. 

Smolenski added: "We are acutely aware of the shock and distress this will cause for our staff and their families. We will ensure that we meet all our responsibilities towards them over the coming months.

"We would also like to express our gratitude to all those who have worked with us over the past months to try to maintain the company in Blackpool.

"We shall be making further announcements in due course about our plans which we believe represent a major advance for the proud name of TVR. But for the time being we are concentrating on our staff in Blackpool and the consultation process."

The Transport and General Workers Union said on Wednesday afternoon that talks with TVR had continued throughout the day following the shock announcement that it was the company's intention to outsource production to another European country.

Speaking during a break in the talks Dave McCall, T&G North West regional secretary, said it would be wrong to build up hopes but the T&G and local authorities were determined to explore all possible alternatives to the company leaving Blackpool before fully accepting closure.

"We have involved the regional development agency as well as Blackpool Council in our deliberations today as we strive to save manufacturing jobs," he said. "There are alternatives including trying to find other sites as well as looking at bringing in other manufacturers. The T&G is not going to let these skilled jobs go or this sports car, which has a long history in Blackpool, disappear from the north west without fully exhausting all the alternatives."

Talks were likely to continue into the evening.

See also: GOLDING'S TAKE: TVR - Phase Two of the Rouble Revolution