UK car parts maker Wagon PLC collapses

Wagon, which employs 6,300 people around the world making parts for Honda, Ford, General Motors, Land Rover and Nissan, hopes to keep some of its overseas operations running, but its collapse in Britain sends a warning about the state of the international auto industry.

Adding to the gloom, car maker Vauxhall, a subsidiary of General Motors Corp. that employs around 5,000 people in Britain, confirmed it is doubling its Christmas vacation for workers to a month to slow down production.

The British government said it held talks with car manufacturers over the weekend, saying that companies including Toyota, General Motors, Nissan and Rolls-Royce had discussed concerns over liquidity.

Both Vauxhall and Jaguar Land Rover, owned by the Indian conglomerate Tata, have reportedly asked the government for financial aid.

Wagon, controlled by American billionaire Wilbur Ross, filed for administration for Wagon PLC and several British subsidiaries, which employ around 500 people.

Interim management specialist firm Zolfo Cooper has taken over the day-to-day operations of the company, which it said it plans to run as a going concern while it “explores options for its future.” Zolfo Cooper added that it expected immediate “small number” of job losses at the company’s head office in Birmingham, northern England, as a result of the appointment of administrators.

The auto industry has been hard hit by the global economic slowdown — the Society of Motor Manufacturers and Traders reported a 36.8 percent year-on-year fall in new vehicle registrations in Britain last month.

Subscribe to The China Post and save 25%. Click here

SharePrintEmail

Write a Comment

Enter your comments - 3000 characters max

Type in image code

Submit

 Receive China Post promos Respond to this email