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Manganese Bronze administrators see 'encouraging' future | Manganese Bronze administrators see 'encouraging' future |
(about 2 hours later) | |
Administrators at the maker of London black cabs, Manganese Bronze, say they are talking to an "encouraging" list of parties interested in its rescue. | Administrators at the maker of London black cabs, Manganese Bronze, say they are talking to an "encouraging" list of parties interested in its rescue. |
The Coventry-based business has had to call in PricewaterhouseCoopers after failing to gain new funding. | |
The move followed a fault with the vehicle's steering box which led to the recall of over 400 cabs and the suspension of sales. | |
The company has been losing money for the past four years. | The company has been losing money for the past four years. |
PricewaterhouseCoopers said in a statement this was due to a "combination of poor UK sales, supply chain issues, and high warranty costs". | PricewaterhouseCoopers said in a statement this was due to a "combination of poor UK sales, supply chain issues, and high warranty costs". |
These were compounded when the accounting errors were discovered in the first half of 2012. | These were compounded when the accounting errors were discovered in the first half of 2012. |
Manganese Bronze had been trying to secure a loan from Chinese shareholder Geely with which it has a joint venture in China. | |
In London alone there are 22,000 black taxis on the road, with a further 18,000 across the UK. | |
Matthew Hammond, joint administrator for PricewaterhouseCoopers said there had been an unsually high level of interest that had come from all around the world, the UK, Europe and further afield. | |
"Our immediate priority is to secure funding in order to explore the options rapidly developed by the management team and key suppliers to resolve the steering box recall." | |
He said they were looking at options to dispose of the business to an investor who could secure the future manufacture of the black cab. | |
The administrators said they had had "immediately commenced discussions with an encouraging list of UK and international interested parties" and encouraged any further interested parties to get in touch "as a matter of urgency". | |
Falling profits | Falling profits |
Manganese Bronze employs 277 people, most of them in Coventry. | Manganese Bronze employs 277 people, most of them in Coventry. |
Earlier this month it stopped sales of its new TX4 model after it discovered a problem affecting the vehicles' power steering, sourced from an unnamed new supplier since February. | Earlier this month it stopped sales of its new TX4 model after it discovered a problem affecting the vehicles' power steering, sourced from an unnamed new supplier since February. |
The company said it had not put anyone in danger but "in extreme cases, it could affect the ability to steer the steering wheel". | The company said it had not put anyone in danger but "in extreme cases, it could affect the ability to steer the steering wheel". |
Manganese and Geely signed a joint venture agreement in 2006 and own a factory in Shanghai that produces taxis for the international market. | Manganese and Geely signed a joint venture agreement in 2006 and own a factory in Shanghai that produces taxis for the international market. |
Sales have been in decline - the Coventry-based firm sold 1,502 taxis in the UK last year, compared with 1,653 in 2010, a fall of 9.1%. | Sales have been in decline - the Coventry-based firm sold 1,502 taxis in the UK last year, compared with 1,653 in 2010, a fall of 9.1%. |
In January, Manganese Bronze had to issue a profit warning, saying that it had made no profit in 2011 and could fall short of expectations this year. | In January, Manganese Bronze had to issue a profit warning, saying that it had made no profit in 2011 and could fall short of expectations this year. |
The group blamed the weak UK economy, uncertainty over the global economic outlook and a delay in fulfilling an order for 1,000 taxis from Azerbaijan. | The group blamed the weak UK economy, uncertainty over the global economic outlook and a delay in fulfilling an order for 1,000 taxis from Azerbaijan. |
For the first six months of 2012, Manganese Bronze recorded an operating loss of £3.1m on revenues of £34.3m. | For the first six months of 2012, Manganese Bronze recorded an operating loss of £3.1m on revenues of £34.3m. |
Then in August, it discovered an accounting error had caused it to understate past losses by a total £4.25m. | Then in August, it discovered an accounting error had caused it to understate past losses by a total £4.25m. |