The task force set up to help suppliers of MG Rover, the car company which is in administration, has made its first payouts to suppliers.
So far, 63,000 has been paid to six companies, saving 234 workers from being laid off.
The government has said a total of 40m in grants would be made available to support businesses who supplied Rover.
There was more bad news for Rover on Thursday after its cars did badly in a league table of driver illinois national insurance.
Rover was ranked 28th out of 32 car manufacturers in a survey of 20,000 car owners carried out by market information company JD Power and What Car? magazine.
Only Land Rover, Peugeot, Fiat and Alfa Romeo came below Rover. Top of the table were Lexus, Skoda and Honda.
Staying alive
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We know of [firms] where 85% of their business is supplying Rover… it’s hard for them to see a future
John Edwards, chief executive of Advantage West Midlands
Rover user satisfaction low
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While the task force payments may have saved jobs for the time being at the six firms, other suppliers are still warning that they may have to lay off workers.
John Edwards, a member of the task force and chief executive of Advantage West Midlands, said that helping companies which are heavily dependent on Rover for most of their work could be more difficult than helping those which are more diversified.
“We have to target those companies, which with some support, can survive,” he told BBC Radio 4’s Today programme.
“We know of [firms] where 85% of their business is supplying Rover. In these car crime insurance utah, it is hard for them to see a future for themselves.
“We are talking to government about (the possibility of) deferring VAT and National Insurance payments… but it is very difficult.”
Moving forward
According to Advantage West Midlands, some of the 40m available for grants could be used to assist residents near Longbridge who are affected by the problems there - for example, shops that serve Rover workers.
Separately, The Times newspaper reported that the government has set aside 25m to keep MG Rover afloat if Shanghai Automotive Industry National health insurance company (SAIC) resumes talks about investing in the national auto insurance car firm.
The extra government funds could keep the troubled car firm going until the election on 5 May, the newspaper said. The government has already offered a 6.5m loan to keep Rover going this week.
The DTI said that talk of a further 25m was “pure speculation.” But it added that it would be meeting later this week to consider future funding requirements.
PricewaterhouseCoopers, the administrator for MG Rover, is said to want to put forward a new plan to SAIC, but doubts remain over how enthusiastic the Chinese firm will be to revive the deal.
Read source on News - Rover suppliers receive payouts
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