GM Chief Hints That Future Of Vauxhall’s Ellesmere Port Factory Is Secure
General Motors, the troubled American carmaker, gave its strongest hint so far yesterday that the future of its Vauxhall plant at Ellesmere Port, Cheshire, which employs 2,100 people, is safe.
Fritz Henderson, GM’s president and chief executive, would not comment on the number of likely job cuts as he completes a restructuring of GM’s Opel and Vauxhall business in Europe. However, he gave a strong vote of confidence in the Ellesmere Port plant, which has just started production of the new, critically acclaimed Astra model.
Mr Henderson said: “Ellesmere Port is the lead plant building our new Astra. If that’s not a better signal about the future of the plant, I don’t know what is.
“I’ve been there a number of times and the team has done a remarkable job. We feel very good about the plant — so good that we made it the lead plant for the Astra. Actions speak louder than words.”
Mr Henderson did not comment on the future of Vauxhall’s Luton plant, which makes the Vivaro van in a joint venture with Renault and is perceived to be more vulnerable because its contract to assemble the vehicle expires in 2013. However, he added that a decision on restructuring Opel and Vauxhall could be announced within weeks. “The discussions began last week and will continue this week,” he said.
Mr Henderson was speaking before a meeting today between Nick Reilly, head of GM’s operations in Europe, and Lord Mandelson, the Business Secretary, to discuss Vauxhall’s future. They are likely to discuss the terms of any financial support that the Government would provide to Vauxhall.
Mr Reilly will also meet Tony Woodley, joint general secretary of Unite, the union representing most of Vauxhall’s workers, this week.
GM said in March that it wanted to offload Opel and Vauxhall after running up losses of $78 billion (£46 billion) from 2006 up to and including this year’s first quarter and seeking $50 billion of bailout money from the US Government. The group filed for bankruptcy in June and agreed to sell Opel and Vauxhall to a consortium led by Magna, the Canadian car parts maker. GM backtracked this month, deciding to keep its European operation, which employs about 50,000 people.
Yesterday GM published the first overview of its finances since emerging from bankruptcy on July 10, reporting a net loss of $1.2 billion for the three months to the end of September. The results suggested that although there is some room for optimism, the company faces big challenges.
Mr Henderson said that GM would repay $6.7 billion in US government loans early, starting with $1.2 billion in December. He also said that GM had begun to repay a bridging loan to the German Government. Opel, part of GM’s European business, has already repaid €500 million (£445 million) this month and will repay the remaining €400 million by the end of the month.
GM had revenue of $28 billion for the third quarter, after strong sales in China. Despite a boost in sales from the US Government’s car scrappage scheme, GM’s American market share in the quarter was 19.5 per cent, flat in relation to the first half of the year.
Article written by: Times Online
Published on: 08:47 17-11-2009
