Manganese Bronze Share Discussion Threads

[davidosh] 23/9/2008 01:09

This is the first time I have seen any acknowledgent whatsoever from MNGS or LTI that a problem exists. The attention drawn to mitigating losses and retaining records of costs incurred suggests a compensation claim could be coming their way.

The costs, compensation, lost sales and erosion of value for the TX4 brand will run into millions IMO and one wonders whether it will also do damage to those potential international sales.



September 22, 2008

LTI VEHICLES STATEMENT

The Public Carriage Office announced on the 19th September that all '56' plate TX4s are withdrawn from service pending a solution to the problem that has caused a number of under bonnet fires.

LTI appreciates the seriousness of this situation and the impact this decision will have on drivers and owners and would like to assure customers that it is applying every effort to resolve the problem

An extensive study is being conducted involving both LTI and external expert engineers to establish the root cause of and liability for the problem.

We recommend that drivers of the affected '56' plate vehicles make arrangements to share or rent another black cab to mitigate their losses and retain an accurate record of any costs incurred. When the engineering investigation has established liability LTI will be able to advise affected drivers of what compensation will be available and from whom.

LTI would also encourage owners and drivers of '56' plate vehicles to have their vehicles checked, as previously advised, as this will assist in the investigation and may help LTI find an effective solution more quickly.

LTI will provide regular updates of all aspects of this issue and sincerely regrets the inconvenience this situation is causing.

ENDS

[davidosh] 20/9/2008 14:23

I have just found this story from the Edinburgh newspaper



And twelve cabs grounded in Brighton

[davidosh] 20/9/2008 13:51

The Daily Mail review from yesterday




It will be interesting to find out how all these compensation for loss of earnings claims are going to be settled. I hear two cabbies in Edinburgh have already sent a claim to LTI for £10,000 due to uninsured loss and expense. That fire was in February allegedly and there are more being reported as the links emerge. 1500 cabs off the road must cost about half a million a day in compensation claims and engineer costs to inspect and approve roadworthiness. I am told that none of the 56 plate cabs can return to the roads even if they have been checked UNTIL the exact cause of the fires has been identified.

Does anyone know who is likely to foot the bill ?

The cabbies may not be popular but do need to earn a living and TX4s will not be in demand again until the whole problem is rectified. It will be a question of funding too. MNGS will be running out of cash with no sales and costs ballooning out of their control IMO.

[domwilliams] 19/9/2008 10:22

Interesting to note that the '56' plate taxis are between 18 and 24 months old, so what component is 'deteriorating' over that time frame, and could the subsequent plates (07, 57, 08) be similarly affected after 18mths or so?

Have Oyster card, will travel!

[davidosh] 19/9/2008 10:00

I complained to the PCO about the locking doors as a safety issue as a concerned passenger and they said they were in discussions about the mechanism being temporarily isolated whilst the dangers exist and the problem has not been resolved. Two hours later all the cabs were taken off the streets so that may be one item on the list for additional safety work. They explained that it is a two day job to do the work on each one. There must be a huge backlog with 1500 cabs recalled and all wanting to get back on the streets working.

[rapier686] 19/9/2008 09:51

So, LTI are checking and certifying 56 plate vehicles as safe after which they can return to service.

But LTI don't know what's causing the problem, so how can they know they've cured it?

What will happen when a checked and returned-to-service cab ignites?

This is also rather concerning, albeit denied by LTI
"The sources added that the blazes under the vehicles' bonnets shorted out vital wiring, making it impossible to open rear passenger doors from the inside"

[davidosh] 19/9/2008 09:42

The problem is that they have not identified which part is defective as the engine compartment gets so scorched they cannot find the root cause so they are going to check every cab with a 56 plate.

That suggests it was a manufacturing problem as all the fires have been from the same six months of production. Unlikely to be anything linked to servicing therefore I guess. There will be a huge financial burden to this and LTI cannot be selling much stock with this uncertainty over the cabs.

My own view is that with only about 180 cabs sold in H2 so far they are at least 50% below target sales and still building a huge surplus of cabs in Coventry. The cashflow will be dire so they may need to raise cash in the market if the bank borrowing is stretched to the limit which is shown in the interims.

[crystalclear] 19/9/2008 09:20

"Any vehicle not signed off by LTI may have its licence suspended by the Licensing Authority and will therefore be unfit for passenger service."

Is there a suggestion that the problem taxis have not been properly serviced and that there will be an increase in maintenance business for LTI?

[davidosh] 19/9/2008 08:56

Reported in the FT with comment from CEO

[verulamium] 18/9/2008 18:44

A big piece a few minutes ago on BBC London about the cab conflagrations...LTI are being very vague about whether they've found what the fault is and can fix it, and cabbies are wanting compensation for loss of earnings from the manufacturers.

[verulamium] 18/9/2008 15:06

...or perhaps a "conflagration of cabs"? An odd move up after all the 56 plate TX4s have been ordered off the streets, and still no comment from the company. Perhaps they'll merge it with their profit warning RNS?

[domwilliams] 18/9/2008 13:21

Should the collective noun here be 'a botch of cabs' ?

[the analyst] 18/9/2008 13:05

It's pretty grim. I wonder if the fault could find it's way into taxis that have been made more recently, or even those being made in China?

Is it integral to a general TX4 design fault, or just those batches made a cople of years ago?

[davidosh] 18/9/2008 13:02

There is more in the local Coventry Telegraph




This part of the story suggests that the TX4 model may need to be withdrawn completely if the problem is not identified and prevented within the next two weeks.

"If LTI's and our own investigations leave us in any doubt as to the safety of this type of vehicle we may have to withdraw our approval of this type of vehicle. We simply cannot take any chances when it comes to safety."


A statement from LTI said: "While there have been no injuries to date, measures are being put in place to minimise the risk to both passengers and drivers.


"Any vehicle not signed off by LTI may have its licence suspended by the Licensing Authority and will therefore be unfit for passenger service.

[domwilliams] 18/9/2008 09:51

Good point, rthak - Morgan Stanley are sitting on 21.6% of MNGS.

It would be very interesting to see what happens here if the MS/Wachovia merger fails for any reason.

[rthak] 18/9/2008 09:29

davidosh - 17 Sep'08 - 23:38 - 428 of 428

As well as the 10pm news it was reported in both thelondonpaper and London Lite yesterday...this is well publicised - people around the office are even joking that we should all stop using black cabs...

this along with Morgan Stanley in trouble (so may see some selling from them) all makes for a interesting short...

[judgement] 17/9/2008 19:09

Sounds just the job for sorting out that stockpile of new taxis.

[davidosh] 17/9/2008 18:09

The story in the Standard suggests this is not about repairs or replacement for defective parts. It is about investigating as the fires remain a mystery.

They are being called in by the PCO and not going to Mann&Overton



The fires on the two-year-old cabs are being investigated by the manufacturer, the Public Carriage Office and TfL but the cause remains a mystery.

London Taxis International has ordered an emergency recall of about 600 TX4 cabs with the backing of the PCO. One hundred with "56" number plates - registered in September 2006 - are due at the PCO's Penton Street depot for examination by Friday.

A second batch of around 500 made at around the same time must be scrutinised by Friday week.

All were built at London Taxis International's Coventry factory.

Any of the vehicles not taken for examination and signed off as safe by the PCO will be barred from operating. A Transport for London spokeswoman said that depending on the outcome of its own investigations hundreds of cabs could be ordered off the roads before the deadlines.


I do not know what happens if they cannot find the cause as eleven fires is more than just a rare occurence. The additional problem is that it will cause uncertainty over sales of the TX4 and September would normally be a busy month with new registrations. This story will very quickly get around the cabbies if they had not already heard something from another cabby who knew an affected driver in the fire damaged cabs. Customers will also be concerned for safety. Lets hope they track down the cause before anyone gets seriously injured.

[domwilliams] 17/9/2008 17:06

I doubt Manganese will have to pay out the cost. I expect this will either be met by insurers or by the engine manufacturers.

I thought cabbies were restricted to taking their cabs to Mann & Overcharge for their services, recalls etc... for warranty purposes? If so, then M&O will be unable to book in much other work for which they can invoice if 600 cabs are coming in over the two week period.

[shanksaj] 17/9/2008 16:33

David

I doubt Manganese will have to pay out the cost. I expect this will either be met by insurers or by the engine manufacturers.

[davidosh] 17/9/2008 16:20

Peeeps reading the Evening Standard will be getting worried about taking a cab not just because of the fares and economy but now because of the safety issue....Cab sales will be even harder hit and the cost of that recall must be enormous. Why no RNS ??

[rthak] 17/9/2008 16:13

davidosh - 17 Sep'08 - 12:42 - 419 of 421

I think we could see a fast sell off pushing this down to 200p if Lehman's start fire selling - no doubt they will sell into any rise as well making a bear squeeze less likely.