BMW remains confident that a £152 million Government subsidy for its Longbridge Rover plant will get European Union approval by June this year. This would give the green light to production of the R30 family of medium sized cars alongside the new Mini in 2002/3.

The mood of optimism comes despite the scepticism of EU competition commissioner Mario Monti to BMW's threat to switch Rover production to a new facility in Hungary if the UK rescue package did not get the go-ahead. In a formal submission to the UK Government, published in the Official Journal of the European Communities last week, Monti questioned whether BMW had been serious about the Tatabanya alternative. The document said a number of questioned needed clarification, and added the commission did not fully agree with the UK versus Hungary costs breakdown nor risk assessment.

But BMW says the Official Journal document is a formal copy of a letter sent to the UK Government more than three months ago, and that all of Monti's objections and questions have since been discussed and answered in full. A BMW Group spokesman said: 'We have no doubt at all that the package will be approved.'