WITH WHICH WE BELIEVED THEIR ESTIMATE OF A FAIR PRICE COULD PRO LY BE LIFTED BY UP TO £12 MILLION, KADOORIE STATED ON FRIDAY THAT HE WOULD ONLY RECOMMEND TO HIS BOARD PURCHASE OF THE TOTAL U.K PACKAGE AT A MAXIMUM PRICE OF £127 MILLION, ON EXACTLY THE QUOTED SCOPE OF SUPPLY. THIS WAS THEIR GENUINE MAKE-OR-BREAK PRICE LEVEL.
11. WITH OUR PRICE STANDING AT £136 MILLION, AND MAXIMUM REDUCTIONS AVAILABLE FROM ALL MANUFACTURERS TOGETHER OF ONLY £8 MILLION (EXTRACTED WITH EXTREME EFFORT OVER THE LAST TEN DAYS IN THE U.K AND IN HONG KONG) WE REMAINED SOME £20 MILLION ADRIFT. IT WAS REGRETTABLY CLEAR TO EVERYONE IN THE U.K TEAM THAT THE U.K SWITCHGEAR HAD REACHED THE POINT OF NO RETURN.
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12. BOTH CRUMMACK OF GEC AND LEGG OF REYROLLE HAVE EXPRESSED SATISFACTION WITH OUR EFFORTS ON THEIR BEHALF, AND INDEED WITH BALFOUR BEATTY'S, IN SPITE OF THE RECOGNISED CONFLICT OF INTEREST.
I DO NOT BELIEVE THEY FEEL LET DOWN, QUITE THE OPPOSITE. NONETHELESS SOME REACTION IN THE U.K IS TO BE EXPECTED, PROBABLY
FROM THE UNIONS. THE FACTORIES AFFECTED ARE AT TRAFFORD PARK (GEC) AND HEBBURN (REYROLLE). WE UNDERSTAND THAT FAILURE TO SECURE THIS ORDER WILL LEAD TO REDUNDANCIES AT BOTH.
13. WE HAVE NATURALLY CONSIDERED ADDITIONAL D.0.1 ASSISTANCE.
IT IS HOWEVER EVIDENT THAT THE SUMS WHICH WOULD HAVE BEEN NECESSARY WERE QUITE OUT OF PROPORTION WITH ANY CASE FOR ADDITIONAL SUPPORT OF THIS INDIVIDUAL ORDER.
14. IT IS EVIDENT THAT WHEN WE RETURN TO THE U.K THE DEPARTMENT
WITH GEC AND NEI, WILL NEED TO CONSIDER CAREFULLY THE INDUSTRY'S FUTURE STRATEGY FOR HIGH VOLTAGE SF6 METALCLAD SWITCHGEAR, AND THE POSSIBILITY OF OUR SUPPORT BOTH FINANCIAL AND IN RELATION TO THE CEGB. THESE ARE DIFFICULT AREAS, AND NOT ONES WHERE QUICK RESULTS CAN BE EXPECTED. BUT I THINK THE EXPERIENCE OF THIS PROJECT, BOTH FOR THE MANUFACTURERS AND FOR US, HAS HIGHLIGHTED THE MAJOR AREAS FOR ATTENTION.
15. I HAVE SET OUT THE SWITCHGEAR SITUATION IN SOME DETAIL,
IN CASE YOU ARE PRESSED WHILE WE ARE AWAY. I SHOULD PREFER NOT TO REPORT TO ALAN WILLIAMS UNTIL WE KNOW THE OUTCOME OF NEGOTIATIONS FOR THE REST OF THE PACKAGE, UNLESS OF COURSE PRESSURE IS BROUGHT ON MINISTERS IN WHICH CASE I HOPE THIS BRIEF GIVES ENOUGH TO DRAW ON. MEANWHILE, BALFOUR BEATTY
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