GM steers away from Torotrak

GEARBOX developer Torotrak's shares crunched into reverse after the company revealed that General Motors had turned its back on the technology. The move comes just over a year after Toyota withdrew from trials, raising fresh fears about whether the gearbox will ever achieve the levels of commercial production needed for Torotrak to make a profit.

The shares crashed 55% to 46 1/2p, leaving the company valued at just £56m against £700m in late 2000. 'For the moment, GM are saying the risks are too big and commercially it is cheaper for them to go on making what they already make,' said chief executive Maurice Martin.

But he said GM's decision was 'not terminal' for Torotrak and that the company's £30m cash kitty would last until at least 2008. Torotrak is still negotiating with transmission maker Getrag, which has a licence to study the technology on behalf of BMW, and Aisin, the world's biggest gearbox maker.