The future of Manganese Bronze, the manufacturer of the iconic London taxi, looked bleak today after the company announced the recall of 400 of the capital's cabs.
It has emerged that the firm's only vehicle, the TX4, suffers from a defective steering box – and as well as hauling hundreds of cabs off the roads, sales of new vehicles have been suspended.
In a statement, Manganese Bronze said: "The steering box is a new design from a new supplier that was introduced in production at the group's Coventry factory in late February 2012.''
It added that work was ongoing to find a ''robust technical solution'' for the steering box fault, adding: ''The suspension of sales will have a very material and detrimental impact on the group's cash flows and the board are working to establish the options available to the business.
''Until such time that a technical solution is developed to rectify the fault, the financial position of the group remains unclear and trading in the company's shares will remain suspended.''
The company's fortunes were in decline before the steering box problem came to light. It sold a total of 1,502 taxis in the UK last year, a figure nine per cent down on the 2010 total of 1,653. Sales of vehicles abroad were up, however.
Financially, the company performed disappointingly in the first half of 2012. It announced an operating loss of £3.1m, and said even before the recall that it was unlikely to return to profit any time soon.
An accounting error didn't exactly help, forcing Manganese Bronze, which operates in partnership with Chinese company Geely, to admit previous figures had been worse than originally stated.
More bad news? Well, their product is starting to look dated and not exactly environmentally friendly as other manufacturers take an interest in the London taxi scene.
The NV200's emissions figures will certainly appeal to environmentally-minded London Mayor Boris Johnson. The TX4's emissions are more than 200g/km of CO2; the 2011 version of the NV200 emits just 138g/km.