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LDV set to enter administration LDV sends staff home as end nears
(40 minutes later)
Struggling van maker LDV has applied to enter administration, a letter to staff on the firm's website says. Staff at struggling van maker LDV have been sent home from work, after the firm applied to enter administration.
Chief executive Evgeniy Vereshchagin said LDV would continue to look for funding until 6 May when its court application was due to be considered. Employees have been paid up to the end of last week, it said, but the firm could not confirm any further payments.
He said employees had been paid up to the end of last week, but that the firm could not confirm any further payments. Staff were told to stay away from work. Birmingham-based LDV employs about 800 people in its factory - though most have been on reduced hours during 2009.
Birmingham-based LDV could not be immediately reached for comment. Chief executive Evgeniy Vereshchagin said LDV would continue to look for funding until 6 May when it is due to formally go into administration
Most of LDV's 850 production workers were laid off in December, when production at the plant largely stopped. There are also about 1,200 people employed in dealerships, with LDV estimating "several thousand" people are employed by its suppliers.
"During the past few weeks, the global economic crisis has forced us to operate in exceptional conditions and we cannot continue in this position without funding indefinitely," Mr Vereshchagin said in the letter. LDV said that it had been relying on the goodwill of suppliers to stay afloat, and that it had run out of money.
Earlier, Erik Eberhardson, the chairman of LDV's Russian owner Gaz, said he believed that LDV could be saved and the management buyout was the best option. "During the past few weeks, the global economic crisis has forced us to operate in exceptional conditions and we cannot continue in this position without funding indefinitely," Mr Vereshchagin said in a letter to staff.
Two overseas investors had also been said to be interested in the company. Malaysian investor, Westar, had been interested in the company - but LDV said it was now unlikely to invest.
Last month, Erik Eberhardson, the chairman of LDV's Russian owner Gaz, said he believed that LDV could be saved and that a management buyout was the best option.
The cancellation of the 2010 British International motor show and a record drop in UK car production are the latest signs of trouble for a sector that has endured a bleak existence for months.The cancellation of the 2010 British International motor show and a record drop in UK car production are the latest signs of trouble for a sector that has endured a bleak existence for months.
Do you work for LDV? How have you been affected by the firm's problems? Send us your comments and experiences using the form below.Do you work for LDV? How have you been affected by the firm's problems? Send us your comments and experiences using the form below.
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