Reuters Report:Land Rover Discovery Under Threat

LONDON, Jan 14 Reuters is repotinh that Production of Ford Motor Co.subsidiary Land Rover's Discovery model could be suspended next month and hundreds of workers laid off in a legal dispute with the receivers of one of its main suppliers, Land Rover said on Monday.

The row follows a demand for 45 million pounds ($65.20 million) from receivers KPMG to Land Rover to secure the future of engineering company UPF-Thompson, sole supplier of chassis for the Discovery, which recently went into liquidation.

Land Rover Chief Executive and Chairman Bob Dover said there was a good chance that production of the Discovery would be suspended ``unless we can find a sensible way out of this dilemma''.

Hundreds of workers face being made laid off until the company can resource and retool the chassis in question ``which is a huge component and can take several months to do'', Dover told BBC Radio.

There could also be far-reaching repercussions for suppliers in the West Midlands industrial heartlands dependent on the Discovery for business, he added.

Land Rover had offered to absorb the increased cost of the chassis and pay a four million pound goodwill charge, but this was rejected by KPMG, the spokesman said.

``As a result we have 1,400 workers who will potentially be laid off although some will be absorbed elsewhere,'' he added.

``If we were to pay the whole sum, we would have to put up some form of security that could endanger the rest of the company.''

A court injunction at the end of last week meant that supply of the chassis was guaranteed until January 25, the spokesman said.

In the meantime, Land Rover would support any attempt by UPF-Thompson to find a buyer or seek a management buy-out.

KPMG could not immediately be reached for comment.