Vauxhall’s future in the balance 1

General Motors have not confirmed the closure of Vauxhall’s UK Ellesmere plant. However they have also not guaranteed that it will stay open either. Signs point towards the closure of the factory after the great losses that Opel and Vauxhall have made over the previous 12 years.

Constructive dialog

Vince Cable, the UK’s Business secretary and the Vice Chairman for Corporate Strategy and Business Development, Stephen Girsky are having ongoing. As reported by us previously in the blog, Vince Cable met with Mr Girsky personally. Mr Cable was attempting to convince General Motors to invest in the UK automotive industry as it shows signs of growth. Will General Motors agree? Mr Girsky has said that there has been “constructive dialogue” between the two parties.

Other car brands to invest

BMW, MINI, Nissan and Jaguar Land Rover seem to agree and have all invested millions into the production of future models.  They all seem to have faith in the UK car market.

European losses

Something certainly has to be done to preserve the future of the plant. General Motors lost a total of $747 million last year. It would make financial sense to cut down on car capacity in order to at least even this month according to General Motors. Currently in Europe there is a dramatic fall in customer confidence and demand. The Euro Zone crisis has ensured that profits are hampered for most car brands across the region.

Peugeot Citroen

In order to reduce these losses, General Motors has joined forces with Peugeot Citroen by joining forces and buying a 7 per cent stake. There are said to be some major decisions to be made, with Ellesmere right at the top of the agenda.

Astra Sports Tourer

The Ellesmere Port Plant was in for praise last year thanks to it’s great success on developing the Vauxhall Astra Sports Tourer.

Vauxhall’s Luton plant

Vauxhall the UK’s biggest supplier of commercial vans. The company’s Luton plant is expected to stay out of the potential cuts from General Motors.

Despite being one of the most productive factories in the UK and Europe, Vauxhall’s Ellesmere factory, which employs 2,100 staff, many believe that the factory will indeed close.

Mr Cable has now met Mr Girsky twice in a matter of weeks. Keeping the jobs and the prestigious Ellesmere Port factory will be a great achievement for Mr Cable if he does indeed manage to convince General Motors to have faith in the UK and European motor industry.