The UK government has given Ford a £500 million loan guarantee to help increase exports, boost EV investment and “safeguard” jobs in the wake of the coronavirus pandemic.
The guarantee, which covers 80% of the loan, is awarded by the UK’s export credit agency, UK Export Finance, and supplements another, £625m loan by commercial banks to Ford of Britain.
International trade secretary Liz Truss said: “This deal firmly puts the UK at the heart of Ford’s plans to grow its export business, reduce emissions and support skilled manufacturing jobs.
“A thriving automotive industry is vital to the success of the UK economy. It brings prosperity and security to manufacturers across the country. That’s why we are putting its needs at the heart of our strategy to remove barriers to trade when negotiating free-trade deals.”
Ford of Britain is one of the UK’s largest exporters, exporting around 85% of the engines and 100% of the transmissions it builds to more than 15 countries on six continents, but it is closing its Bridgend engine plant in South Wales in September, with the loss of 1700 jobs.
The £500m loan is intended to boost exports and prevent similar job losses at Ford’s other engine factory, in Dagenham, as well as its Dunton campus in Essex. It will also help Ford to electrify more of its vehicles, following the announcement of its first all-electric Transit, set to be launched in 2021.
Last year, the government gave an almost identical £500m loan guarantee to support Jaguar Land Rover’s electrification schemes.