""JLR is to be applauded for its hard work in getting funds in place and for producing a workable payment scheme," Morley said. "However, there are still key issues, especially for smaller firms. Understanding what qualifies a supplier for support is paramount, and there is still reliance on the goodwill of tier one suppliers to pass payments down. In some cases, we know this hasn't happened.""
""Suppliers further down the chain need urgent liquidity to survive and then to fund the restart of production," Morley said. "The second hurdle is a gap in sales, which could stretch to ten or twelve weeks - and that could be the real breaking point.""
The Confederation of British Metalforming welcomed Jaguar Land Rover's staged return to production and the launch of a supplier funding stream, while warning that serious liquidity problems persist for smaller supply-chain firms. CBM President Stephen Morley said the carmaker's payment scheme provides a welcome boost for top-tier suppliers but does not adequately reach tier 2, 3 and 4 businesses. Smaller suppliers face uncertainty over qualification for support and reliance on tier-one goodwill to pass payments down. The government convened major banks to discuss emergency support, and CBM urged suppliers to contact their banks immediately. The Growth Guarantee Scheme could be adapted to provide interest-free working capital, and the CBM taskforce remains in dialogue with HM Treasury on longer-term options.
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