UK car production slumped by a third last month, reinforcing the industry's urgent need for Government help, the Society of Motor Manufacturers and Traders said today.

Just 97,604 cars were made in November, a fall of 33% on the same month a year earlier. Commercial vehicle production plunged 50%.

The figures came as Business Secretary Lord Mandelson revealed the Government is in talks with Indian group Tata, which owns Jaguar and Land Rover about a £1 billion bailout scheme.

But Mandelson stressed Tata had “first responsibility” to ensure the carmakers' survival and warned the Government did not have “an open cheque book” to bail out ailing private companies.

SMMT chief executive Paul Everitt said: “The UK motor industry is facing unprecedented challenges, and urgent action is now required.

The sector has seen falls in demand, plant closures and the first signs of redundancies in the supply chain.

“Without swift action and the ability to access credit and finance, significant damage will be done to the nation's industrial capability, leaving the UK poorly equipped to take advantage of any global growth when it returns.”

Jaguar-Land Rover chief executive David Smith said: “We have made it clear that we fully support the SMMT's call for a range of support measures for the car industry — suppliers, manufacturers and dealers — as has been forthcoming in other countries.

“The SMMT have made it clear that the situation in the UK is a national emergency requiring urgent action. We believe that Jaguar Land Rover plays a critical role in the car industry in the UK.”