Chinese firm set to control MG Rover

[fedsron2us]

BRITAIN’S only remaining mass market car maker seemed certain last night to pass into foreign control after MG Rover admitted merger talks with a Chinese firm were at an advanced stage.

The proposed deal will result in the Shanghai Automotive Industry Corporation (SAIC) pumping £1bn into the new company in return for a 70% share in the venture.

Unions at MG Rover reacted with delight to the news, which they believe will secure the 5,200 jobs at the Longbridge plant in Birmingham. But they expressed disappointment MG would be the minority partner in the new company, with just 30% control.

The deal will spell the end of British-owned mass car manufacturing. Rover, as it was then known, was sold to BMW in 1994, but after the Germans poured in an estimated £2.5bn of investment, the loss-making company returned to British hands in 2000 when a consortium led by former Rover executive John Towers bought it for a token £10.

http://scotlandonsunday.scotsman.com/index.cfm?id=1338932004

As Ford and GM wind down their car making ventures in Britain the Chinese are buying up the last remaining British owned volume vehicle manufacturer. Interestingly, MG Rover builds cars in the West Midlands where there a lot of marginal seats in the UK Parliament. Now the business is in the hands of the state owned Shanghai Automative this is going to give the Chinese government quite a lot of leverage in British domestic politics. I expect future UK leaders to be cancelling some of their proposed trips to Washington and to be booking a few more to Beijing.

edit- for typo

[VivaKerry]

1. Unions are cheering! Like leading cows to slaughter....

"
Unions at MG Rover reacted with delight to the news, which they believe will secure the 5,200 jobs at the Longbridge plant in Birmingham. But they expressed disappointment MG would be the minority partner in the new company, with just 30% control."

Yeah, I would like to survey that 5200 people about the quality of their jobs in a few years.

Do they really think that plant will REMAIN in birmingham??? Maybe ignorance is bliss.

[fedsron2us]

2. Rover was doomed without a buyout.

Jobs for a few more years are better than no jobs today and it is more than any US corporation is offering. Any way I think that China is buying political influence as much as a car company

[jody]

3. The Chinese are buying multinational corporations with profits made from

selling products to the U.S. produced by jobs outsourced to China.
:bounce:

[D-Notice]

4. Does this mean that

out-sourcing IS good for the economy (of another country)?

[jody]

5. I see no reason to disagree with your astute observation! n/t