Blair tries to save Motorola plant

More than 3,000 people work at the West Lothian plant

The prime minister has intervened to try to save the Motorola plant at Bathgate in the east of Scotland from closure.

The mobile phone company had been expected to announce that it was closing the factory, which employs more than 3,000 people.

But it is understood Tony Blair held a 15-minute telephone conversation with Motorola's president, Chris Galvin, on Tuesday in an effort to stave off any immediate closure measures.

It was widely thought that the American telecom giant would announce the closure of the Bathgate plant in West Lothian on Wednesday.

Mr Blair telephoned Motorola's president, Chris Galvin

That announcement now seems to be on hold as the company has agreed to discuss all options.

The news came as the US telecoms giant issued a worse than expected first-quarter operating loss.

The company said it lost $206m in the first quarter compared with a profit of $481m a year ago.

It is the first time Motorola has posted a loss in the first quarter in 15 years.

The company has been trying to improve its financial performance by taking aggressive cost-cutting measures including the slashing of 22,000 or 15% of its jobs this year.

Danny Carrigan, the Scottish Regional Secretary of the engineering union, the AEEU, said he was pleased that the Prime Minister had intervened and he was hopeful it would help.

There is over-capacity in the mobile phone market

"I'm sure the reason why he has intervened is because something can happen and because there is an excellent case for keeping the plant open.

"I'm sure his advisers would not have him publicly intervening if there wasn't some hope here."

Mr Blair's intervention followed high level discussions between the company and the Scottish Executive.

For its part, the executive said no statement was expected from Motorola concerning the plant's future on Wednesday.

Scotland's Enterprise Minister Wendy Alexander told BBC Scotland that the company has some difficult decisions to make.

She said: "The important thing is that there has been a real stay of execution.

"The pressure to try and jump in response to these very bad results has been arrested and there is a chance to go back to 'what is the case for Motorola in Scotland?'."

Danny Carrigan: Excellent case for keeping the plant open

The West Lothian factory has been facing closure for the past month after Motorola decided on a massive worldwide restructuring programme with the loss of 7,000 jobs.

Councillor Willie Dunn, chairman of West Lothian Council's Economic Development, said it was important to keep the plant open.

"We need to make sure the plant is there for the future because all indications are that mobile phone manufacture is going to pick up in a couple of years.

"We would like to see the plant staying in West Lothian so when that rise comes we can ride on the back of that and hopefully put production levels back up to the levels we see today."

SNP enterprise spokesman Kenny MacAskill said: "I think the best thing that Blair can find out is what is happening.

"I think the hiatus is deeply disturbing for those involved in the industry, because any redundancy will be a personal tragedy."

Enterprise Minister Wendy Alexander: "Stay of execution"

He said the government should be investing in skilled people and creating the infrastructure for technology to thrive.

Motorola described the reports as "rumour" and "speculation", but stopped short of denying them outright.

A spokesman said the plant was currently on its two-week Easter shutdown.

He said: "We have made no decision and we have made no proposals to the consultation forum at the plant."

The spokesman added that employees had previously been told of the need to cut costs globally in the mobile phone division.

Meanwhile, Mike Zafirovski, president of Motorola's Personal Communications Sector, which is responsible for the Bathgate plant, has been reporting to American investors on the company's plans.

He did not comment specifically on the West Lothian plant but re-affirmed a strategy of cutting jobs and reducing production at the company's more expensive factories.

He said: "We are continuing efforts to increase the efficiency of our supply chain. We are exiting or reducing production at several higher cost manufacturing sites.

"These action will result in well above $1bn annualised savings.

"We expect to see the positive impact of these actions in the second half of the year when we return project a return to profitability."