UK sanctions £10m loan to Tata Motors - Car Rental News
UK sanctions £10m loan to Tata Motors
Car Rental News - 21/09/2009
Indian automaker to manufacture electric cars in the UK
The British government has okayed a £10-million loan to Indian automaker Tata Motors for the new electric car project in Britain. Tata is the first company to secure funding under the UK government's 2.3 billion pound automotive assistance programme (AAP). The programme was launched in January this year, as an aid package for the automotive industry, with the aim to promote low-carbon techonology.
Tata Motors has committed to an additional 25 million pounds of its own investment towards developing and building electric cars in the UK. The company is now said to be considering locations in the UK to set up its factory base.
Tata Motors has already developped a four-seater electric car with Norwegian group Miljo. Production is expected to commence later this year in Norway. The Norwegian government awarded this project a one million pound grant, and also sanctioned a six million pound loan.
Tata Motors applied for the 10 million pound loan from the UK government to help launch its new four-seat Indica Vista electric vehicle. The plug-in vehicle will be manufactured in Britain.
After applying for the loan in April. Tata Motors had reportedly been furious on being informed by officials in July that more time was needed to ascertain whether the project could be considered for the loan. The company had threatened to shelve the project if the £10-million loan was not granted soon.
Other carmakers have also been urging the UK government to quicken the process for disbursement of loans under the AAP.