MG to end UK car production at Longbridge with switch to China

Image source, PA
Image caption,
The first new MG for 16 years rolled off the production line in the West Midlands in 2011

MG has announced it is to stop making cars at its Longbridge plant and will be moving production to China - ending manufacturing in the UK.

The firm said vehicle assembly was no longer "required" and cars would arrive "fully built ready for distribution".

MG said there would be 25 redundancies, but sales, marketing and after-sales operations would remain at the plant.

The first new MG for 16 years rolled off the production line in the West Midlands in 2011.

It marked the first large-scale production at the plant since the demise of Rover in 2005.

It will also be end of car manufacturing at the Longbridge plant - which has seen cars built there since since Herbert Austin set up in 1906., although there was a gap in production when MG shut down in 2005.

Image source, PA
Image caption,
The Longbridge plant, which spreads into Worcestershire, covered 400 acres before part of it was redeveloped

More than 400 design engineers and other staff at the SAIC Motor Technical Centre (SMTC) at the site and MG Motor employees are not affected.

"Centralising production demonstrates MG's commitment to the future, as well as its continued focus on attracting and developing the highly-skilled automotive engineering and design talent present in the UK," a spokesman for MG said.

Where possible, production staff would be moved into new roles, the spokesman added.

Two models are currently designed and made the site - MG3 and an SUV, the MG GS - and sales are increasing with the firm reporting a total year on year rise of 18%.

Analysis: Professor David Bailey of Aston University

I think MG through Shanghai Automotive's owner have been kind of hanging on there.

They've had a flawed business model in that it was importing virtually the entire car for Longbridge with some very limited assembly, about 40 to 50 workers.

I think what has really scuppered them is the Brexit vote.

They had fundamental business problems in that they were not selling as many cars as they hoped and they had the big import costs of components.

Post Brexit though, the evaluation of stirling at 10%, those imports much more expensive so costs are higher and there is uncertainty about the future on the trading relationships in Europe.

What they had hoped to do was use the UK as a launch pad for selling into Europe. If - big if - we are no longer part of the single market what is the point of investing there?

Matthew Cheyne, head of sales and marketing at MG Motor UK, said moving production abroad was "a necessary business decision".

Richard Burden, Labour MP for Birmingham Northfield, described the decision as "hugely disappointing and premature".

"I understand the business concerns that MG have surrounding costs of assembly at Longbridge, which have undoubtedly been aggravated by problems with the strength of the pound," he said.

"However, more discussions should have taken place to explore alternatives and options before any decisions were finalised."

He said the government was willing to meet MG to discuss options and he had hoped the announcement would not be made until further talks had been held.

Image source, Matthew Lewis
Image caption,
Two models are currently designed and made the plant

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