The fate of Vauxhall’s two UK factories and their workforce is on hold until their new French bosses receive ‘guidance’ from the UK and EU over what sort of trade deal will be in place post-Brexit.
Ministers and politicians in Britain and on the Continent need to explain ‘how they want to play the game’, before serious decisions can be made on whether to keep, close or even expand the UK plants, said Carlos Tavares, chief executive of new Vauxhall Owners, PSA Group.
Thousands of jobs at the two British plants rest on the decision.
Are British jobs at Vauxhall safe? New owner PSA Group said it was waiting for ‘guidance’ from the UK and EU before deciding to keep, expand or potentially close the two vehicle factories in the country
Speaking to journalists at the Frankfurt Motor Show, mercurial Portugese engineer and car boss Mr Tavares said: ’The Brexit question for us is still something we’re working on.’
His team has been examining the impact of different ‘scenarios’ on the Vauxhall plants at Ellesmere Port and the van-making plant in Luton from the so-called ‘soft’ and ‘hard’ exit options from the European Union.
The issue of tariffs and currency levels would be crucial, he said.
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’I would prefer to have some guidance from the UK government and from the European Commission about how they want to play the game,’ he added.
‘It would be much better for everybody, not just the PSA Group, but also for all the other stakeholders, that we have some guidance about how this is going to unfold.
‘The sooner we have some guidance form the UK government and the European Commission about how they want to play the Brexit, the better it will be.’
Carlos Tavares, Chairman of PSA said he was waiting on guidance from the UK government and the European Commission before making a decision about Vauxhall’s British manufacturing hub
Vauxhall has two production facilities in the UK – the car manufacturing plant in Ellesmere Port (left) and the Luton factory building commercial vehicles (right)
Vauxhall plants in Ellesmere Port and Luton (pictured) together employ 4,500 staff, though thousands more work in Vauxhall’s UK showrooms and supply chain
PSA – which already consists of French brands Citroen, Peugeot and DS Automobiles – bought General Motors’ European business which operates under the Opel badge in Germany and continental Europe, and Vauxhall in the UK.
Currently, the two factories employ around 4,500 workers.
Mr Tavares said their product cycle was five years and key decisions needed to be made now about where future cars would be built.
That included decisions over investment and future product lines: ‘We need to prepare,’ he said.
Under existing cycles, the Ellesmere Port car plant is due to build the existing Astra family car until 2021 while the plant in Luton will assemble the Vivaro van until 2024.
Carlos Tavares, left, CEO of the PSA Group and the CEO of Opel Michael Lohscheller present the new Opel Insignia GSi at the Opel stand on the first media day of the Frankfurt Motor Show
Based on current production cycles, Vauxhall’s Ellesmere Port should run until 2021 building the current generation Astra. The other, in Luton, which builds the Vivaro van, would be safe until 2024 when a new model would look to replace it
Ellesmere Port alone built 118,182 vehicles in 2016 – that was a 38.6% improvement on the units assembled the year previous
He said he had not discussed the matter with the UK government since he met with Prime Minister Theresa May ‘a few months ago’ but was planning to return to the UK to discuss ‘difficult scenarios’ and contingency planning with is team.
He said the enlarged PSA Group would see its car production rise from 3 million to 4 million vehicles a year.
US-giant General Motors’ sold Opel and Vauxhall to PSA earlier this year for €2.2billion after the European operations of the US giant lost money every year since 1999.
Tavares said at the time of the deal that he was keen to keep Opel’s management team in place to continue the turnaround of the business, which had been frustrated by Britain’s vote to leave the EU.