Britain's carmakers demand access to state funds

LONDON, Nov 19 (Reuters) - Britain's hard-pressed car manufacturers are demanding access to the government funds put aside to bail out the banking sector in a bid to ride out the on-going economic crisis.

Industry bodies the Society of Motor Manufacturers and Traders (SMMT) and the Retail Motor Industry Federation (RMIF) said on Wednesday they had written to Chancellor Alistair Darling asking for a series of emergency measures to help combat the downturn.

"The motor industry faces a set of unprecedented market conditions. The dramatic falls in demand for new vehicles ... combined with the limited availability of funding and liquidity now puts at risk valuable industrial capability," SMMT chief executive Paul Everitt said in a statement.

One request was for manufacturers' finance arms to be allowed access to the 50 billion pounds ($75.34 billion) state fund made available to banks last month, helping to protect giants including Royal Bank of Scotland (RBS.L) and Lloyds TSB (LLOY.L).

British new car registrations fell by an annual 23 percent in October, the steepest decline this year. The country's three biggest manufacturers are Japan's Nissan (7201.T), Toyota (7203.T) and Honda (7267.T), but the demands are also planned to help smaller makers and suppliers.

In the United States Senate Democrats have proposed bailing out the country's ailing car makers with $25 billion in loans while executives there have warned that their industry is teetering on the brink of disaster.

The European Union is also looking into supporting its carmakers after General Motors Corp's GM.N Opel unit asked the German government for state aid.

But EU competition commissioner Neelie Kroes has said the car industry cannot expect to be treated in the same way as the financial sector, pointing out that a bailout of banks had been allowed because of the widespread fears of a collapse. [ID:nLI406644] (Reporting by John Bowker; Editing by Hans Peters)