Department for Business, Innovation and Skills
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UK given the green light for state help to Automotive Industry

UK given the green light for state help to Automotive Industry

DEPARTMENT FOR BUSINESS, ENTERPRISE AND REGULATORY REFORM News Release (2009/44) issued by COI News Distribution Service. 27 February 2009

The UK has been given the go ahead by the European Commission (EC) to offer state help for the automotive industry under the Automotive Assistance Programme.

The approval by the EC enables the government to support up to £1 billion of loans and loan guarantees as well as loan guarantees through the European Investment Bank (EIB) enabling funding of up to £1.3 billion.

Business minister Ian Pearson said: "We are grateful to the Commission for its swift response and approval of our state aid application. We welcome applications for the Automotive Assistance Programme that's now up and running just one month after announcing our support package for the automotive industry.

"We are committed to helping the car industry bridge to the low carbon future. Our package will support both manufacturers and larger automotive suppliers in delivering the new investment that will be vital in ensuring the industry comes out of the current downturn with the skills and technology needed to be competitive in the global automotive market."

BERR will be holding a seminar in the next couple of weeks to bring together industry, banks and the relevant trade bodies to make sure that the Automotive Assistance Programme application process runs as smoothly and effectively as possible.

Notes to editors:

1. The Government is now able to move forward to implement the automotive industry support package announced by Lord Mandelson on 27 January 2008 aimed at freeing up lending of £2.3 bn for the automotive industry. The Commission's decision to approve the UK's state aid proposals enables the Government to provide guarantees to unlock loans of up to £1.3bn from the European Investment Bank for investment in lower carbon initiatives, and also to provide guarantees to support up to £1bn of lending for lower carbon initiatives for non-EIB backed projects. Where appropriate, occasionally direct loans may be considered. The scheme will be administered by BERR and the Department will be publishing guidance and application criteria for companies shortly.

2. Companies can register an interest by emailing BERR at

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