THE maker of London’s iconic black taxis is in talks to
secure a £15m loan from its Chinese shareholder to stave off collapse.
Manganese Bronze hopes to secure the cash from Geely, the carmaker that
is one of its largest shareholders, with a 20% stake.
The Coventry-based company is in dire straits after it stopped vehicle sales and suspended its shares this month following the recall of 400 taxis. Cabs were withdrawn from service after a fault was discovered in their steering system.
If the two sides fail to agree a deal, investors fear the British group could be forced into administration.
Geely, which formed a joint venture with Manganese Bronze in 2006 to transfer production of the black cabs to China, is keen to protect its investment.
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Transport chiefs in London are being urged to draw up a contingency plan in case the troubled taxi maker Manganese Bronze goes out of business.
Industry representatives are warning of a looming shortage of black cabs because of a financial crisis at the loss-making Manganese, which has halted sales of its TX4 taxis after a steering fault was discovered.
John Robins’ who’s Taxi has been affected Said ” I haven’t slept properly for three days” said taxi driver John Robins whose TX4 taxi has been deemed unsafe by Manganese Bronze
“I’m the only earner in my family at the moment-my wife looks after our children”
His taxi was only two weeks old when he got a phone call on Sunday.
“They told me in no uncertain terms to stop using the cab and that its licence had been suspended”
After much searching he found a taxi available to rent, on a temporary basis for £180 a week.
He wants Manganese Bronze to take back the TX4 entirely and to release him from a deal under which he is obliged to pay £135 a week for four years . It has declined to do so.
“They haven’t got a solution and they have not got the finances to sort this out”.
Boris Johnson, the Mayor of London, has agreed to relax temporarily tough emissions requirements for taxis so that black cabs used in other cities can be brought in on a temporary basis.
Manganese has recalled 400 vehicles across the country, including 316 cabs in the capital because of the defect. Dealerships have run out of replacement cars, leaving frustrated taxi drivers without a livelihood. At a recent industry liaison meeting, taxi drivers’ representatives asked Isabel Dedring, London’s Deputy Mayor for Transport, to suspend a rule that bans drivers in vehicles older than 15 years from plying their trade.
The rule, introduced last year, has already meant the withdrawal of 1,495 taxis from London’s streets and a further 994 are due to be retired by the end of the year. The capital has 25,000 taxis.
Darryl Cox, secretary of the London Cab Drivers’ Club, said that Ms Dedring had been urged to plan for a scenario of Manganese ceasing trading: “It’s a worst-case scenario. It’s a bit like the euro collapsing — everybody’s got an opinion but nobody really knows what would happen.”
Manganese’s shares have slumped by 75 per cent in a year and trading in the stock has been suspended. The company, which made a £3.6 million first-half loss, is in talks with Geely, its Chinese partner, in the hope of securing funds.
The problem with Manganese’s taxis lies in a steering box from a new Chinese supplier, introduced in April. There have been two recorded instances of steering suddenly becoming locked. Some taxi drivers, who are on hire-purchase deals, are trying to surrender their vehicles entirely on the ground that they are not fit for purpose — a conjection that Manganese is rejecting.
“We’re quite disgusted, really. Many of us knew about this steering problem in August,” Mr Cox said. “A lot of innocent people have been caught up in it.”
Most of London’s taxis are Manganese models. The only other manufacturer with a cab that fits the capital’s unique requirement for a tight, 25ft turning circle is Mercedes, which makes a six-seat minivan, the Vito, that costs £42,000.
Peter Da Costa, chief executive of Mercedes’ EcoCity Vehicles division, said: “We’re obviously concerned about drivers caught up in this and we’re helping them in any way we can.”
Rival taxi manufacturers have suggested that London is far too reliant on two suppliers and that the capital’s “conditions of fitness”, which set exacting standards for taxi specifications, should be relaxed.
Donald Pow, general manager of the Glasgow-based taxi maker Allied Vehicles, said that the capital’s rules were anachronistic. “There’s a lack of choice in the market. That choice is what drives innovation, price and quality. It’s ironic, given that the turning circle in London is such a bugbear, that it should be steering that’s caused this issue,” he said.
A Transport for London spokesman said: “We continue to closely monitor the situation.”
The Coventry-based company is in dire straits after it stopped vehicle sales and suspended its shares this month following the recall of 400 taxis. Cabs were withdrawn from service after a fault was discovered in their steering system.
If the two sides fail to agree a deal, investors fear the British group could be forced into administration.
Geely, which formed a joint venture with Manganese Bronze in 2006 to transfer production of the black cabs to China, is keen to protect its investment.
--------------------------------------------------------------------------------------------------------------------------
Transport chiefs in London are being urged to draw up a contingency plan in case the troubled taxi maker Manganese Bronze goes out of business.
Industry representatives are warning of a looming shortage of black cabs because of a financial crisis at the loss-making Manganese, which has halted sales of its TX4 taxis after a steering fault was discovered.
John Robins’ who’s Taxi has been affected Said ” I haven’t slept properly for three days” said taxi driver John Robins whose TX4 taxi has been deemed unsafe by Manganese Bronze
“I’m the only earner in my family at the moment-my wife looks after our children”
His taxi was only two weeks old when he got a phone call on Sunday.
“They told me in no uncertain terms to stop using the cab and that its licence had been suspended”
After much searching he found a taxi available to rent, on a temporary basis for £180 a week.
He wants Manganese Bronze to take back the TX4 entirely and to release him from a deal under which he is obliged to pay £135 a week for four years . It has declined to do so.
“They haven’t got a solution and they have not got the finances to sort this out”.
Boris Johnson, the Mayor of London, has agreed to relax temporarily tough emissions requirements for taxis so that black cabs used in other cities can be brought in on a temporary basis.
Manganese has recalled 400 vehicles across the country, including 316 cabs in the capital because of the defect. Dealerships have run out of replacement cars, leaving frustrated taxi drivers without a livelihood. At a recent industry liaison meeting, taxi drivers’ representatives asked Isabel Dedring, London’s Deputy Mayor for Transport, to suspend a rule that bans drivers in vehicles older than 15 years from plying their trade.
The rule, introduced last year, has already meant the withdrawal of 1,495 taxis from London’s streets and a further 994 are due to be retired by the end of the year. The capital has 25,000 taxis.
Darryl Cox, secretary of the London Cab Drivers’ Club, said that Ms Dedring had been urged to plan for a scenario of Manganese ceasing trading: “It’s a worst-case scenario. It’s a bit like the euro collapsing — everybody’s got an opinion but nobody really knows what would happen.”
Manganese’s shares have slumped by 75 per cent in a year and trading in the stock has been suspended. The company, which made a £3.6 million first-half loss, is in talks with Geely, its Chinese partner, in the hope of securing funds.
The problem with Manganese’s taxis lies in a steering box from a new Chinese supplier, introduced in April. There have been two recorded instances of steering suddenly becoming locked. Some taxi drivers, who are on hire-purchase deals, are trying to surrender their vehicles entirely on the ground that they are not fit for purpose — a conjection that Manganese is rejecting.
“We’re quite disgusted, really. Many of us knew about this steering problem in August,” Mr Cox said. “A lot of innocent people have been caught up in it.”
Most of London’s taxis are Manganese models. The only other manufacturer with a cab that fits the capital’s unique requirement for a tight, 25ft turning circle is Mercedes, which makes a six-seat minivan, the Vito, that costs £42,000.
Peter Da Costa, chief executive of Mercedes’ EcoCity Vehicles division, said: “We’re obviously concerned about drivers caught up in this and we’re helping them in any way we can.”
Rival taxi manufacturers have suggested that London is far too reliant on two suppliers and that the capital’s “conditions of fitness”, which set exacting standards for taxi specifications, should be relaxed.
Donald Pow, general manager of the Glasgow-based taxi maker Allied Vehicles, said that the capital’s rules were anachronistic. “There’s a lack of choice in the market. That choice is what drives innovation, price and quality. It’s ironic, given that the turning circle in London is such a bugbear, that it should be steering that’s caused this issue,” he said.
A Transport for London spokesman said: “We continue to closely monitor the situation.”
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