Ford shopping around for best state aid deal

A senior Ford manager yesterday indicated that the company was shopping around to see which government could draw up the best aid package as the future of the company's Halewood plant hung in the balance.

Jac Nasser, head of Ford Europe told BBC Radio 4's Today programme that it was an "open competition" between Britain and countries on the Continent. Ministers made it clear that state aid would be available to secure Ford's future, but government critics argued that it would be too little too late.

Based on company figures leaked to The Independent, union officials last night calculated that Ford would be saving $140m (pounds 86.4m) in redundancy costs by axing 1,300 jobs at Halewood and producing the replacement for the Escort model at Saarlouis in Germany.

Employees' leaders also estimated, using figures produced by a company think tank, that Ford could gain around $120m in state aid.

Greg Knight, Trade and Industry minister, told the Commons that the company was unlikely to change its mind over the decision to produce the Escort replacement at Saarlouis and Valencia in Spain.

Mr Knight said the Government was involved in discussions with Ford over possible financial assistance to ensure that Halewood would not be closed. He said, however, that management had not talked of closing the Merseyside plant during previous discussions.

Adam Ingram, for the Opposition, urged the Government to include the Labour Party in talks with the company which are scheduled for next week. He said Labour was now a "government-in-waiting" and needed to be involved in the deliberations. Unions are due to meet Mr Nasser today and tomorrow in an attempt to change Ford's mind. The location of the talks, believed to be in central London, are being kept secret to avoid demonstrations by Ford workers.

Unions are preparing a strike ballot among the car giant's 30,000 workers in protest at the decision to produce the Escort at the two Continental plants.

In the absence of an agreement, voting is scheduled to begin on 20 February with a result on 13 March. In the absence of a settlement industrial action would then have to start with a month of the announcement of the ballot result which would be uncomfortably near the general election from the Labour Party's point of view.

Tony Woodley, national official of the Transport and General Workers' Union, registered his confidence that there would be a "Yes" vote in the ballot if the company was not prepared to compromise.

"While we are anxious to avoid a confrontation in these negotiations, we are not going into the discussion accepting that the Escort is going to leave this country. The company simply does not have a case." He argued that on the basis of cost and quality Halewood should have been chosen to produce the new model.

In a briefing document published yesterday the company said Halewood had a "realistic future".