ROVER boss Werner SM- mann has warned that the high value of sterling poses a threat to all British exporting jobs, writes David Duffy.

He said Rover had suffered from the high value of sterling, which makes its cars more expensive to buy overseas, throughout 1998.

Speaking as Rover unveiled its new top-of-the-range Cowley-built 75 model to motoring journalists at an international launch in Seville, Spain, he said: "It is still too high and the danger to British manufacturing is that it will stay too high against the euro through 1999. This means we are exporting jobs."

But Prof SM- mann, who called for Britain to join the single European currency as quickly as possible, said he did not want to use exchange rates as an excuse for all Rover's problems.

He said: "We must reduce our cost base and become faster on our feet.

Prof SM- mann took over from Dr Walter Hasselkus as chairman and chief executive of BMW-owned Rover a month ago and has already toured all Rover's plants, including the new assembly lines at Cowley.

He said: "The true test is to cope with the bad times. A strong company should be able to survive a strong economy through its flexibility, speed of reaction and strong brand positioning. "Unfortunately for Rover the speed with which the value of currencies change has exposed problems. Rover is too inflexible, unable to react quickly enough and cannot fully establish brand levels in the marketplace.

"Improvements were overtaken by fast-falling revenues, therefore we faced a hard cost-cutting programme and we have started a turnaround."

Before Christmas, management and unions thrashed out a deal which will lead to 2,500 redundancies and a new working hours agreement.

Prof SM- mann added that Rover's target continued to be to break even in 2000.

Story date: Wednesday 03 February

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.