A COMMITTEE of MPs is to mount an inquiry into the car industry to investigate why some firms have a thriving base in the UK while others close plants, it has been announced.

The Trade And Industry Select Committee said it will consider how firms made investment and closure decisions and how the Government responded.

The MPs will also study what the Government can do to help workers when factories close.

The announcement was made in the wake of the decision by French carmaker Citroen Peugeot to close its factory in Ryton, Coventry, with the loss of 2,300 jobs.

The fortunes of the West Midlands plant contrast with Swindon's Honda plant, which employs 4,000 people and has enjoyed success with the Civic model.

Committee chairman Peter Luff said: "The recent announcements of the closures of Peugeot's plant in Ryton and TVR's factory in Blackpool, and the strong possibility of similar future announcements, have led the committee to broaden its inquiry into the Government and MG Rover into a more general examination of the state of the automotive industry in the UK.

"And what, if anything, the Government could or should do to support it.

"We will be taking forward the evidence sessions that we had already planned on lessons to be learned from the experience of the MG Rover Taskforce.

"Given the urgency of these issues, we have postponed decisions on the other aspects of the MG Rover inquiry."