Taxpayer To Suffer As Vauxhall Limits Job Losses
The new head of Vauxhall said yesterday he was confident that far fewer than 800 workers in the UK would be made redundant as the carmaker indicated that it wanted loans and guarantees from the British taxpayer.
However, the car group is also seeking a deal with unions to extract concessions from workers that could include pay cuts and reductions in benefits.
It is also understood that Vauxhall is actively seeking a manufacturing partner to rival Renault to secure the production of another vehicle at the company’s Luton plant. The Luton site produces the Vivaro, a small commercial van, with Renault, but Vauxhall’s partnership with the French carmaker will expire in 2013.
Although Vauxhall will press Renault to commit to making another model in Luton after 2013, it is understood that it is also trying to determine whether other car groups would be interested in a partnership.
Nick Reilly, the new head of GM Europe — the business that controls Vauxhall in the UK and Opel on the Continent — said yesterday that the carmaker needed €3.3 billion (£2.9 billion) to cover the cost of dismissing as many as 10,000 workers across Europe and to reduce capacity by 25 per cent. He added that GM Europe had $2.5 billion (£1.5 billion) in cash, which would run out in the first quarter of next year.
Yesterday Mr Reilly — who said that he did not envisage taking a pay cut — met Lord Mandelson, the Business Secretary and, separately, Tony Woodley, the joint general secretary of Unite, Britain’s biggest union. The meetings effectively kicked off the latest round of detailed talks between governments, unions and GM Europe to discuss the car group’s plans for Vauxhall and Opel. Mr Reilly said that the talks could be completed within three weeks and, certainly, by the end of the year.
Vauxhall has about 5,500 employees at two plants in the UK: Ellesmere Port, in Cheshire, where the Astra is manufactured, and Luton. Workers have been dogged by uncertainty over their future for more than a year after General Motors, the American-based parent, was forced to ask Washington for bailout funds.
After his discussions with Mr Reilly, Lord Mandelson said: “We have had a positive meeting with GM. Today’s new plan represents a solid commitment to the Vauxhall plants, a testament to the workforce as well as the management. GM has committed to Luton to 2013 and will look for other products. GM will be looking for financial support and the UK is prepared to underwrite it.”
Mr Reilly wants both loans and loan guarantees from Lord Mandelson. It is believed that the peer is prepared to offer a few hundred million pounds to assist Vauxhall. However, both the Government and unions need to be convinced of the feasibility of GM’s business plan and whether it will commit to pledged job numbers in the medium and long term.
GM and EU finance ministers have been invited to a meeting in Brussels on Monday. A spokesman for Günter Verheugen, the EU Industry Commissioner, said that the meeting had been called to discuss GM’s plans for its European operations and to “co-ordinate”.
Article written by: Times Online
Published on: 09:10 18-11-2009
Taxpayer To Suffer As Vauxhall Limits Job Losses
The new head of Vauxhall said yesterday he was confident that far fewer than 800 workers in the UK would be made redundant as the carmaker indicated that it wanted loans and guarantees from the British taxpayer.
However, the car group is also seeking a deal with unions to extract concessions from workers that could include pay cuts and reductions in benefits.
It is also understood that Vauxhall is actively seeking a manufacturing partner to rival Renault to secure the production of another vehicle at the company’s Luton plant. The Luton site produces the Vivaro, a small commercial van, with Renault, but Vauxhall’s partnership with the French carmaker will expire in 2013.
Although Vauxhall will press Renault to commit to making another model in Luton after 2013, it is understood that it is also trying to determine whether other car groups would be interested in a partnership.
Nick Reilly, the new head of GM Europe — the business that controls Vauxhall in the UK and Opel on the Continent — said yesterday that the carmaker needed €3.3 billion (£2.9 billion) to cover the cost of dismissing as many as 10,000 workers across Europe and to reduce capacity by 25 per cent. He added that GM Europe had $2.5 billion (£1.5 billion) in cash, which would run out in the first quarter of next year.
Yesterday Mr Reilly — who said that he did not envisage taking a pay cut — met Lord Mandelson, the Business Secretary and, separately, Tony Woodley, the joint general secretary of Unite, Britain’s biggest union. The meetings effectively kicked off the latest round of detailed talks between governments, unions and GM Europe to discuss the car group’s plans for Vauxhall and Opel. Mr Reilly said that the talks could be completed within three weeks and, certainly, by the end of the year.
Vauxhall has about 5,500 employees at two plants in the UK: Ellesmere Port, in Cheshire, where the Astra is manufactured, and Luton. Workers have been dogged by uncertainty over their future for more than a year after General Motors, the American-based parent, was forced to ask Washington for bailout funds.
After his discussions with Mr Reilly, Lord Mandelson said: “We have had a positive meeting with GM. Today’s new plan represents a solid commitment to the Vauxhall plants, a testament to the workforce as well as the management. GM has committed to Luton to 2013 and will look for other products. GM will be looking for financial support and the UK is prepared to underwrite it.”
Mr Reilly wants both loans and loan guarantees from Lord Mandelson. It is believed that the peer is prepared to offer a few hundred million pounds to assist Vauxhall. However, both the Government and unions need to be convinced of the feasibility of GM’s business plan and whether it will commit to pledged job numbers in the medium and long term.
GM and EU finance ministers have been invited to a meeting in Brussels on Monday. A spokesman for Günter Verheugen, the EU Industry Commissioner, said that the meeting had been called to discuss GM’s plans for its European operations and to “co-ordinate”.
Article written by: Times Online
Published on: 12:54 19-11-2009
