China-made London taxis to begin UK assembly in September

UK sales volumes were down 12.9% to 803 vehicles (2009: 922) although the company managed to cut operating losses by 29.9% to £1.0m (2009: £1.4m) as challenging market conditions continued but projects and initiatives that were instigated to return the Group to profitability have begun to take effect. These included the closure of the North American business, UK cost savings, the move to a UK assembly only operation, restructuring of the UK dealer network, the Chinese supply of parts and TX4 model international sales. The impact of reduced costs from Manganese Bronze's joint venture in Shanghai (SLTI) and the restructuring of its Coventry operations in the UK would contribute to second half improvements, it said. The Group has incurred exceptional costs related to the planned move to import kits of bodies and panels from SLTI for assembly in Coventry. The transfer will begin following the three week summer shutdown on 16 August. Ending the manufacture of body panels and chassis in Coventry will result in a total of 60 manufacturing redundancies with 32 employees having already left the business, with a further 28 scheduled to leave during August/September. The company expects to realise annual savings of £2.4 million by assembling the Chinese-made bodies and panels for its TX4s in Coventry. Chief executive John Russell said it had been another challenging six months for the Group but he was pleased to have managed to reduce the operating loss so dramatically – a sign of a reducing cost base, and the benefits of the joint venture. "We have secured initial third party funding for our international customers which will help to drive future international sales volumes for SLTI produced TX4's," he went on. "The steps we have taken to mitigate the uncertainty of the economic climate are beginning to take effect which bodes well for the full year."