PSA committed to Vauxhall after meeting with UK union

24 January 2018

French PSA Group has said it will move ahead with its recovery plans for British manufacturer Vauxhall and its plants in the UK after agreeing to further trade union talks.

The general secretary of the country’s Unite union, Len McCluskey, met with PSA CEO Carlos Tavares in Paris following the announcement that the company is to lay off an extra 250 workers at the Vauxhall plant in Ellesmere Port. This announcement came after 400 jobs had already been cut, meaning total job losses of 650 employees.

′Further meetings are planned to quickly move this recovery plan for Vauxhall’s manufacturing sites to the highest level of performance, after years of degradation and in line with the PACE! recovery plan’ said a statement released by Vauxhall.

′Carlos Tavares repeated his desire not to close UK plants, which is reassuring. He also talked of working with Unite to construct a roadmap for future operations in the UK, again encouraging,’ said McCluskey in a statement released by Unite. ′I remain optimistic, however, that we can work constructively with PSA, albeit with the uncertainty and confusion caused by Brexit being a consideration for the company.’

Vauxhall and Opel were acquired by PSA in August last year, and Tavares had initially been critical of the company’s plants, especially those in the UK, saying that when compared to existing PSA factories, they were inefficient. The job cuts at Ellesmere Port, where the company produces the Astra model, meaning the facility will operate just a single shift, which is aimed to increase productivity.

However, there were further fears that due to Brexit and the uncertainty surrounding trading negotiations and potential tariffs, PSA may look to move Astra production away from the UK completely, instead installing it in one of its existing plants which already build models of a similar size.

PSA has said manufacturing costs in Britain are twice those of its French plants, and that it will only be able to decide on investment once this has been addressed, and it has a better idea of the shape of Britain’s future trading relationship with the EU.

The situation had not been lost on McCluskey, who added: ′I will also be pressing the business secretary Greg Clark, to ensure that the UK government does all it can to create the climate for PSA investment. I will be seeking a meeting with the secretary of state on this as soon as possible because there is no time to lose. The three parties – PSA, Unite and the UK government – must work together now to give our plants a future.’

The French manufacturer group is looking to reduce costs across the entire Opel and Vauxhall brand following years of losses under its General Motors ownership. It announced its PACE! plan in November 2017. Vauxhall appointed a new boss earlier in January, tasked with turning the British arm of Opel around.

Photograph courtesy of Opel