The Government yesterday confirmed that it had put together a £2 million aid package to help the French car-maker Peugeot create 900 new jobs at its Ryton plant near Coventry. Stephen Byers, the Trade and Industry Secretary, said Peugeot would get the money under regional selective assistance and training schemes.
He said that 200 of the new jobs would be created under the Government's New Deal scheme, which subsidises employers who recruit from the ranks of the long-term unemployed.
Peugeot announced the new jobs last December when it said it was recruiting a third shift for Ryton, which makes the new Peugeot 206. The new shift will set a precedent for the British motor industry, in that its members will have to work every Friday, Saturday and Sunday.Mr Byers said that Peugeot's decision to invest in Ryton underlined the competitiveness of the United Kingdom as a manufacturing base and confirmed the West Midlands as one of Europe's leading automotive manufacturing centres.
He added: "I particularly welcome the potential of this investment to create many new opportunities for long-term unemployed people to get back into work, supported by government-funded training."
His comments come as Rover Group and its German parent, BMW, are seeking up to A200 million in government aid as the price of saving the 12,000 jobs at the group's Longbridge works in Birmingham. BMW has said that the aid package will determine whether it builds a replacement for the Rover 200 and 400 models at Longbridge or at a new site in Hungary.
DaimlerChrysler yesterday revealed that it had pulled out of six-month long talks to buy an equity stake in Nissan, Japan's heavily indebted car firm, but said it would continue co-operation in the manufacture of heavy trucks.
Louis Schweitzer, the chairman of Renault, said the French vehicle group was still studying a possible alliance with Nissan, but added that there would be no immediate announcement.
"We've always said it was an attractive prospect but that it wouldn't be easy," he said.
"I have underlined recently that this could offer great opportunities, but that it was something which included some risk related to the situation of Nissan and to the differences of culture, so we are going on with our in-depth study," he said.
Nissan, which has lost money during six of the last seven years, indicated earlier this year that a foreign car manufacturer buying up to a third of the company's shares would get boardroom representation and a veto over management initiatives.
