A union has called for the government to assist the black cab maker Manganese Bronze, which has called in administrators.
The Coventry-based firm, which trades as the London Taxi Company, had its shares suspended earlier this month after a fault with 400 of its vehicles.
The firm employs 288 staff, with 170 of them based at its factory in the city.
Union Unite said it would contact the government. The firm's boss remains "hopeful" of a successful resolution.
The company had been trying to secure a loan from Chinese shareholder Geely, a partner since 2006.
Unite national officer Roger Maddison said: "We hope Geely is ready to come up with some assistance but if not then the government's going to have to help.
"This is what the government's plan for saving the economy is.
"They're going to have to come up with some money and help and they're going to have to come up with it soon.
"They're shedding jobs in the public sector and expecting the private sector to pick up that work so when companies like London Taxis are in trouble they're going to have to help otherwise their whole business plan is going to fail."
The latest problem relates to a fault with the TX4 vehicle's steering box which the company said had not put anyone in danger - but "in extreme cases, it could affect the ability to steer the steering wheel".
'Fantastic reputation'Chief executive of Manganese Bronze, John Russell, said he was uncertain what effect going into administration would have on jobs but he remained optimistic about the future.
Mr Russell said: "We're a business with a fantastic reputation, everyone calls us an icon and we had a huge amount of interest in what was happening to the company yesterday.
"I think that in turn will create a lot of interest and the administrators will have a lot of choices about what to do with the business."
He said the catalyst for the firm's problems was the credit crunch.
"Our business halved in the space of two years and we got into all sorts of difficulty in terms of the cost structure.
"When the recall was announced we suddenly went to a position where we couldn't sell cars. We had no money coming into the business," he said.
He said there had been efforts to protect the business: "Geely were very co-operative, very supportive but at the end of the day the business just couldn't take on the debt that was being contemplated.
"Geely are going to play a part in this process. They are our partner, they are a key supplier to the business, they were a historic investor and there is a big debt owed to Geely as a result of this."
Mr Russell said the key thing was for the steeling problem to be fixed so the business could start "generating revenue".
"That will give us a period of grace whilst the administrator looks for options for the business."
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