MG Rover is halting production for four days this week to enable dealers to 're-balance' inventories. The news follows yesterday's Observer report that MG Rover sales had fallen by some 50% in the last three weeks, possibly influenced by negative media coverage of corporate financial transactions.

MG Rover spokeswoman Suzanne Barch said sales were "below plan", without confirming a report in The Observer yesterday that registrations had dropped by nearly half in the past month or so.

The Observer also reported that Birmingham businessman John Hemming "had sent a list of demands to the company, threatening legal action to force greater openness at Phoenix". He is reportedly concerned that the A, B and C shares in MG Rover held by employees and other stakeholders relate only to assets acquired in the original 2000 deal between Phoenix and BMW, chiefly the still-loss-making MG Rover. Businesses that were later acquired, such as Powertrain and MG Rover's finance arm, are excluded.

These shares do not carry voting rights, unlike D shares held by directors. "This is very naughty, and is something that should be remedied," Hemming told the paper. He has also advocated the appointment of a non-executive director to Phoenix Venture Holdings' board - an appointment that MG Rover's spokeswoman said the directors of Phoenix, a private company, would consider if a candidate able to add value to the company were to come forward.