BL plunges £122m into the red

DAILY EXPRESS
By Peter Hitchens

British Leyland lost £122M. last year--and the vital car division is expected to stay in the red this year. Chairman Sir Michael Edwardes last night blamed the engineering strikes of last summer and the strong pound. He said: "We do not expect to enter calmer waters before 1981."

Sir Michael, -who has decided to stay with BL until at least the end of next year, stressed the hopeful signs for the future  "I believe we are doing the right thing , " - he said. "We are closer to crunching a number of complex problems, including overmanning , low productivity , over -capacity , and product image ."

Moves to cut manning, especially on the bus and truck-sides, were well ahead of schedule. He and his fellow executives said that the strong  pound  which makes out exports much more expensive is a major burden. At home, although cash was always a major, problem, BL was not facing a cash flow crisis. Sir Michael said that his "Buy British" campaign was starting to have an impact.

"We know this from the sharp increase in traffic through our dealer, showrooms, and from the hundreds of letters we have received. The employment implications have caused people to think about their buying habits."

The major hurdle facing BL is to get agreement to the pay and working reforms in the car division - the biggest part of the company. After 16 meetings with unions, Including one yesterday, a "summit " with union leaders has been set for Monday. Sir Michael said: "New working practices are essential if we are to compete with the international motor, industry. Unless we are competitive, more and more jobs will be at risk."

Head of the car division, Mr Ray Horrocks, who will lead Monday's session was optimistic about the outcome.  After meeting unions yesterday, he said: "I believe we stand in a better position."

Last night his optimism seemed justified. Union opposition to the pay and efficiency deal, which cuts the power of shop stewards, appeared to be weakening.