Britain's car industry is seeking help from the Government amid mounting concern for the future of Vauxhall's Ellesmere Port factory and many component makers and dealerships.

The Society of Motor Manufacturers and Traders (SMMT) wrote to Alistair Darling, the Chancellor, and Lord Mandelson, the Business Secretary, yesterday, calling for measures including access to credit and loans that could run into billions of pounds.

The SMMT is refusing to put a figure on the help that the industry might need, but it wants support for manufacturers, parts suppliers, leasing companies and dealerships.

However, Garel Rhys, of Cardiff University Business School, said: “This is a pre-emptive strike from the SMMT. There are not any specific figures because, if there were, people would want to know where they had come from. There are a lot of worries about Vauxhall, but it is not clear that the likes of Honda and Toyota are knocking on the door for money.”

Professor Rhys estimates that if Vauxhall's Ellesmere Port factory, which produces the Astra, needs significant help, it would probably need more than £250 million. If assistance is spread across the entire automotive sector, in varying degrees, there would need to be an injection of several billion pounds.

Professor Rhys said: “Ellesmere Port is now Britain's marginal plant. There is always one that is most vulnerable and that is now it. The Japanese makers would not want to lose their British plants because they are their bridgehead to Europe. They do not have other significant facilities in Europe.”

The SMMT and the Retail Motor Industry Federation (RMIF) are calling on the Government to provide credit facilities to manufacturing and sales operations and also to allow the car companies' finance units to obtain special liquidity arrangements, such as those made available to the banks.

Vauxhall's factory on Merseyside is viewed as the most vulnerable car plant in Britain because it is owned by General Motors (GM), of the United States, which has given warning that it could run out of cash by the year end. In Germany, Opel, a GM subsidiary, has asked the German Government for €1 billion (£838 million) to keep operations going if funds from America stop.

GM's sales in Europe have been hit hard and industry experts believe that the company could look at production cuts, with Ellesmere Port or the Antwerp factory vulnerable to closure.

With all European car companies suffering, Acea, the European trade body, has asked for €40 billion in aid to help environmental development and other investment. Unlike their American counterparts, the European companies are not yet facing bankruptcy or seeking emergency help.

The British car companies are channelling requests for help through the SMMT, although some executives have directly pressed ministers for aid for the industry.

David Smith, chief executive of Jaguar Land Rover, has made personal appeals to the Prime Minister and the Chancellor. Sales of the Land Rover brand have plummeted as motorists have turned to vehicles that are more fuel-efficient. However, Jaguar Land Rover, which has several factories in the Midlands and one on Merseyside, is not seen as being as immediately vulnerable as Vauxhall because it is owned by Tata, the Indian conglomerate.

All of the British car industry is now on short-time working to reduce output and job cuts have begun among temporary staff and several hundred permanent staff. The Christmas closedown next month is likely to be one of the longest for many manufacturers as they use it to cut output further.

Paul Everitt, chief executive of the SMMT, called for action in next Monday's Pre-Budget Report. He said: “Urgent action is required to boost demand for new vehicles and ease pressure on UK automotive suppliers.

“The motor industry faces a set of unprecedented market conditions. The dramatic falls in demand for new vehicles in the UK, Europe and around the world, combined with the limited availability of funding and liquidity now puts at risk valuable industrial capability.

Both the SMMT and the RMIF want the Chancellor to scrap the planned increase in vehicle excise duty. The also want increased capital allowances for fleet buyers, the shelving of plans to reform business car capital allowances and help to speed up the delivery of existing cash help for training, research and development, and energy efficiency work.

Paul Williams, chairman of the RMIF, said: “These measures and others, jointly proposed by the two industry trade associations, would go some way to helping the revival of consumer confidence in our sector. We urge the Chancellor to undertake these measures, and to discuss further action with us if necessary.”

- Nissan said yesterday that it would make no profit in the six months to next March.

Carlos Ghosn, chief executive of Renault-Nissan, told The Wall Street Journal that the impact of the downturn in global car markets on the group would be severe. The company said that his comments did not represent a literal target, but a “characterisation” of the group's performance in the second half and that it stood by a previous forecast of a net profit of 33.7billion yen ($347 million).

Mr Ghosn added that the crisis in the car industry would lead to further consolidation. It is believed that Nissan and GM held merger talks with Chrysler. He said: “We are still stuck in a situation where credit is not flowing normally and the recession that began in the United States is deepening and spreading across the globe.”

Meanwhile Toyota is to stop US production for two days next month.

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