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UK car firms get European funding UK car firms get European funding
(18 minutes later)
The European Investment Bank (EIB) has approved funding for two carmakers in Britain, Jaguar Land Rover and Nissan. The European Investment Bank (EIB) has approved funding for two carmakers in the UK, Jaguar Land Rover and Nissan.
The EIB approved a £340m (366m euros)package for Jaguar Land Rover and a £370m (400m euros) package for Nissan's UK and Spain operations. The EIB approved a £340m (366m euros)package for Jaguar Land Rover to help cut vehicle emissions.
Jaguar Land Rover had applied for money to invest in research and technology to develop more environment-friendly cars at its Midlands and Merseyside plants. And it awarded £370m (400m euros) to Nissan to develop and build more fuel-efficient vehicles at its plants in Sunderland and Spain.
Nissan also asked for funds to produce more fuel efficient, cleaner engines. The funding is the first money provided to any carmaker in the UK since the financial crisis began.
The moves come as the car industry has been hit globally by a slump in sales.The moves come as the car industry has been hit globally by a slump in sales.
Under EIB rules, any loan requires that carmakers must invest in new technology to lower emissions during vehicle production and driving.
The bank also approved a loan for a Volkswagen plant in India.
The EIB has now raised its total lending by 15bn euros per year for 2009 and 2010 compared with previous years.
Struggling industry
Based in Gaydon, Warwickshire, Jaguar Land Rover employs about 15,000 people in the West Midlands (Castle Bromwich, Coventry and Solihull) and Merseyside (Halewood).
Nissan's plant in Sunderland opened in 1986 and employs about 4,900 workers.
Some 12 million people are employed in the European car industry, including 800,000 workers in the UK.
Figures released on Monday illustrated the gloomy state of the UK car industry.
UK car sales dropped 30.5% in March, compared with the same month a year earlier, according to the Society of Motor Manufacturers and Traders (SMMT).
The industry argues that help is needed immediately for carmakers to ensure they can survive the recession.
Business Secretary Lord Mandelson has set aside £2.3bn in support for the car industry, mostly in the form of loan guarantees as well as direct aid to car makers.