Land Rover calls for legal change

Bob Dover: Wants changes to UK insolvency law

By Jorn Madslien BBC News Online business reporter in Geneva

The car company Land Rover has vowed to campaign for changes to UK insolvency law.

The Ford subsidiary's desire to shake up the system was aroused after taking on debts owed by UPF-Thompson, the insolvent supplier of the chassis for the Discovery model, to secure continued production of the car.

"We've really got to lobby for some change," Land Rover managing director Bob Dover told BBC News Online at the International Motor Show in Geneva.

"I want to be 'Land Rover, the car company', not 'Land Rover, the bank responsible for my suppliers' problems'.

"What we intend to do is to put down some ideas, either a code of practice or [suggestions about] where we think the law could be usefully changed, and put those forward to the government."

Land Rover will also consult suppliers on their views.

"We need to have some guidelines for insolvency practitioners that are perceived to be and felt fair by all of the stakeholders," Mr Dover said.

Bailout

Land Rover's dispute was with the accountancy firm KPMG which was acting as the receiver for UPF-Thompson.

KPMG told Land Rover that, without a cash injection, UPF would fold.

Talks aimed at resolving the problem failed.

"In the end, because we were getting nowhere with the gun-to-the-head negotiations, we decided to go to court," said Mr Dover.

Land Rover was granted a temporary injunction which forced UPF to continue supplying the chassis.

At the time, industry insiders had said the case could cause a shift by manufacturers away from the reliance on sole suppliers of car parts.

But Mr Dover said Land Rover's position towards suppliers had not changed.