British van maker LDV is fighting for its life, with the Government still deciding whether to give it a £5 million bridging loan to tide It over while foreign backers are sought.

It was not only a fraught time for the firm but a worrying time for fleets which run LDV Maxus vans.

If the deal fails and LDV goes bankrupt, the existing manufacturer warranties would be invalidated, as happened when MG Rover ceased production.

LDV marketing director Guy Jones told Fleet News: “We are doing everything possible to save LDV but if it didn’t exist, neither would the warranty.

"It would be down to our 123 UK dealers to decide whether or not to honour the warranty but it would put them in a very difficult situation.”

LDV announced a huge 500-van solus deal with Jewson recently and despite the uncertainty about the manufacturer’s future, the deal still holds good at present.

Jones said: “We are hoping the Government will grant us this money so we can kick-start production again and we can supply these vans.”

Two foreign backers that expressed an interest in LDV had not been named, but both are understood to be Asian.

The initial request for Government money was deferred as officials at BERR, the Department of Business, Enterprise and Regulatory Reform, demanded details of both the backers and LDV’s future business plan.

These were provided in meetings over the weekend.

The firm, which employs 850 people in Birmingham, is hoping restart operations, which ceased in December, concentrating on the production of a new electric-powered Maxus.

LDV is still owned by Russian conglomerate GAZ, which has been unable to support the British arm after it fell foul of the global credit crunch.

Erik Eberhardson, the chairman of GAZ, said he remained convinced the firm can be saved, with a management buyout being the best option.

He said: “I am an optimist and that remains the case.

"We are hopeful and I am happy that we are at a stage where we have both a hearing from the Government and clearly interested investors.

"It could have been a lot worse.”