Rover's parent company, BMW, has said work practices have to be overhauled to cut costs aand make Longbridge more productive.

More than £1bn of new investment earmarked for the site hinges on the restructure.

"Further job reductions are inevitable to achieve these objectives," the company said in statement on Friday.

"The current talks, to find cost reductions of £150m ($252m) and productivity improvements, are continuing."

Both the company and unions have repeatedly declined to comment directly on how the talks are progressing.

Payrise assured

However, Rover has pledged to honour a 3.7% pay rise due to be paid to workers in November, part of a deal struck in July 1997.

BMW says Longbridge suffers from low productivity

On Wednesday union representatives were believed to have presented their initial response to last week's announcement by Rover that far-reaching improvements to productivity were vital to save the plant and its 14,000 jobs.

Around 2,400 jobs at the plant are believed to be under threat as BMW seeks overall annual employment cost savings of £150m for the next three years.

However, Rover has denied the 2,400 figure and that any specific number of job cuts has been targeted.

If the productivity talks fail, BMW may move production overseas.

Tony Woodley: Cuts not yet accepted

Lead union negotiator Tony Woodley said earlier in the week the unions have not yet accepted that major job cuts are inevitable.

Bail-out rumours

On Sunday, Rover also denied a report that BMW was set to request £300 million in government grants to revamp the Longbridge plant.

Last week's restructuring announcement overshadowed the Birmingham Motor Show launch of the company's new car, the Rover 75, dubbed the company's 'last chance saloon'.