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UK focused on new Vauxhall model after Peugeot buyout
March 6, 2017 / 9:07 AM / 6 months ago

UK focused on new Vauxhall model after Peugeot buyout

A sign for a car dealership is displayed near Vauxhall's plant in Luton, Britain, March 6, 2017. REUTERS/Neil Hall

LONDON (Reuters) - Britain’s business minister and the country’s biggest trade union said they were focused on securing the long-term future of Vauxhall’s plants after France’s Peugeot (PEUP.PA) confirmed it would buy the British brand from General Motors.

GM (GM.N) had committed to build the Astra Sports Tourer model until around 2021 at its Ellesmere Port plant in northern England and Peugeot has said it will honour existing agreements.

But as investment decisions in the car industry are often made two to three years before a new model rolls off the production line, Britain’s biggest union believes the next few months could be key to securing the future of the site.

“The next six months will be crucial in discussing the next model for Ellesmere Port,” Unite General Secretary Len McCluskey told Reuters.

“We’d like to be in a position certainly by the end of next year to know what that model was so that we can begin to prepare for it,” he said.

A sign for a car dealership is displayed near Vauxhall's plant in Luton, Britain, March 6, 2017. REUTERS/Neil Hall

Britain’s business minister Greg Clark said he was pleased that Peugeot would respect commitments to Vauxhall’s employees and its pensioners but hoped to build on that for both Ellesmere Port and the Luton van plant in southern England.

“We will continue to engage and work with PSA in the weeks and months ahead to ensure these assurances are kept and will build on the success of both sites for the long term,” he said.

Slideshow (2 Images)

Despite concerns about the impact of Brexit, which could see tariffs and customs checks on car parts entering Britain and exports of finished models making plants less competitive, Peugeot Chief Executive Carlos Tavares said having a British plant may prove to be an advantage.

“There is... Brexit and the risk and the opportunity to have inside of the UK some manufacturing plants in case we have a hard Brexit. All of this represents opportunities that we want to tackle,” he said on Monday.

There are around 4,500 Vauxhall jobs in Britain. The brand is the British part of the European Opel business which PSA is buying from General Motors.

Tavares played down the threat of the deal to British factories when he visited London last month.

Reporting by Costas Pitas; editing by Kate Holton/Keith Weir

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