£270m boost for Ellesmere Port Vauxhall plant

Reporter:

Phil Robinson

THE parent company of Vauxhall’s Ellesmere Port plant has been given a £270 million boost by the UK Government.

Announcing the huge cash injection for the European arm of General Motors, Business Secretary Lord Mandelson said it would help safeguard the future of the car maker’s two British plants – at Ellesmere Port and Luton – along with its factories in Europe.

GM had planned to sell Opel after going into bankruptcy protection last year, but then changed its mind.

After announcing an increase in its investment in Opel and Vauxhall to 1.9bn euros, GM said it needed 2bn euros of loans and guarantees from European governments.

The UK Government has now pledged the equivalent of 300 euros under its Automotive Assistance Programme.

The company is now requesting another huge cash top-up from Germany, where the majority of its European workers are based.

GM recently announced plans to cut 8,300 jobs across Europe and is closing plants as it seeks to revive the brand.

No jobs will be lost at the Ellesmere Port plant, which employs 2,166 people including hundreds from Chester, Wrexham and Flintshire.

However, the company has confirmed that more than 360 jobs are to go at the van factory in Luton, Bedfordshire.

Opel/Vauxhall says it is “very pleased” with the announcement from the British Government, which it described as a “strong vote of confidence in UK automotive industry and in particular, the contribution made by the Vauxhall brand and its manufacturing operations in the UK”.

The company added it has been in discussion with the British Government for many months and that this “very positive conclusion” meant that Opel/Vauxhall could now forge ahead with its restructuring plans and strengthen its product lines and future offers to its customers.

Nick Reilly, chief executive of Opel/Vauxhall and a former plant director at Ellesmere Port, said: “We very much appreciate the support of Lord Mandelson and the British Government which is a vote of confidence in Vauxhall, helping to sustain jobs and the excellent manufacturing operations we have in the UK.”

Andrew Miller, MP for Ellesmere Port and Neston, said: “This is a Labour Government in action, supporting our manufacturing industry. We will continue to work with General Motors on the next generation vehicle because Labour is determined to see a long-term future for vehicle manufacture in Ellesmere Port.”

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