The UK Government is providing a £360 million (US$541 million) loan guarantee for Ford’s £450 million (US$677 million) loan from the European Investment Bank (EIB). Ford is investing £1.5 billion (US$2.26 billion) over the next five years for the development of a new generation of more fuel efficient and lower emitting engines and vehicle technologies.
The UK projects to be supported cover research and development for Ford’s commercial vehicles such as the Transit and Connect vans and the development of low carbon emission diesel and gasoline engines. This includes investment in production facilities for new lower carbon engines in Bridgend. Currently 25% of all Ford engines worldwide and more than 50% of all Ford diesel engines are made in the UK.
Ford produces around a million diesel engines a year from a 1.25L up to a high performance V8 unit. Ford currently provides 29% of the UK’s automotive sector research and development.
The paperwork for Ford’s loan and backing from the Government was signed off during a visit by Business Minister, Mark Prisk, to Ford’s technical centre at Dunton, Essex. The Dunton site is one of four that will benefit from the investment. The others are Ford’s manufacturing plants in Dagenham, Southampton and Bridgend in South Wales.
The European Investment Bank is pleased to support Ford’s cutting-edge engine research and development in Dunton and Dagenham and the company’s upgrading of manufacturing operations in Bridgend, Southampton and Dagenham, in particular through the European Clean Transport Facility. A new generation of low-emission engines and more fuel-efficient vehicles will develop new skills and innovation across the United Kingdom, and these new vehicles will make a significant contribution to combating climate change.—European Investment Bank Vice President Simon Brooks
The European Investment Bank is the European Union’s long-term financing institution and provides long-term finance for capital projects promoting European economic objectives. The EIB made its first loan in the UK in 1973 and since then has lent around €75 billion (US$94 billion) for investment in the UK economy.
European Investment Bank funding makes use of the European Clean Transport Facility, a dedicated €4 billion (US$5 billion) annual package approved by European Union Finance Ministers in December, 2008 that support investments targeting research, development and innovation in the areas of emissions reduction and energy efficiency in the European transport industry.
The mechanism is designed to enable automotive companies of all sizes to continue crucial research, development and innovation investment using cheaper and longer-term loans backed by the 27 European Union member states. In 2009 the European Investment Bank supported 33 projects in the automotive sector; of these, 17 projects financed in 2009 complied with objectives defined by the European Clean Transport Facility.