Car firms say banks averse to lending

Jan 22 2010 by Iain Laing, The Journal

BANKS have come under attack from the motor industry amid claims they were unwilling to lend money to car firms as they struggled in the recession.

Officials from the Society of Motor Manufacturers and Traders (SMMT) have held talks with banks to try to speed up loans, but were not optimistic.

Paul Everitt, SMMT chief executive, held talks with banks including Barclays, Lloyds and HSBC in recent weeks about loans to car firms. One banker told him: “We are not going to make any money out of that”, while another said: “If the suit industry had fallen by 30%, we would treat them the same way.”

Mr Everitt said: “I think they are making a mistake because they don’t understand the strategic shift to our industry and the economy.”

Meanwhile, car giant General Motors said it is to close a factory in Belgium with the loss of over 2,000 jobs.