A source close to Britain’s biggest trade union, Unite, said that it was increasingly concerned about the future of Vauxhall plants in England should French automaker PSA Group reach a deal to buy GM’s European Opel-Vauxhall unit.
For years, Europe’s car industry has been plagued with overcapacity, causing analysts to expect that a potential sale of GM’s loss-making Opel-Vauxhall to PSA will lead to cuts in capacity and, by association, jobs. Last week, two sources close to PSA told Reuters that job and plant cuts were part of negotiation between General Motors and PSA, as the latter continues to seek to acquire the Opel-Vauxhall unit. The two Vauxhall plants in Britain were said to be the primary candidates of being shut down.
Britain’s decision to leave the European Union, which could result in trade tariffs, is thought to be a leading factor in the decision.
Of the 38,000 people employed by GM Europe, roughly 4,500 are employed Britain.
U.K. politicians and Vauxhall stakeholders became particularly concerned for the future of the nation’s two Vauxhall plants in Ellesmere Port and Luton as PSA was reported to have pledged to continue operating all Opel plants in Germany if it proved successful in acquiring Opel-Vauxhall from GM.
“We are increasingly concerned after reports that German plants are safe,” the trade union source told Reuters. The trade union also added that the head of the Unite union, Len McCluskey, would likely meet PSA Chief Executive Carlos Tavares in London on Friday.
British officials have also been lobbying hard to meet with PSA Group executives. Earlier in the week, British business minister Greg Clark said he was told by PSA executives that they valued the Vauxhall brand and prided themselves on not closing plants but instead focusing on finding efficiencies elsewhere. Clark stated that PSA was not in a position to give guarantees, since it was still in talks with GM. He added that the German government was in contact with London and that the two countries would not be played off against each other. According to a government source, Clark is due to meet PSA Chief Executive Officer Carlos Tavares “towards the end of the week”.
Other U.K. officials are also in talks with PSA’s Tavares. Prime Minister Theresa May also plans to speak with the chief executive. According to her spokesman, she is determined to protect Britain’s car industry.
“It’s going to be a private conversation. There’s been a request for a meeting and we will try to make that meeting happen, but I am not going to go into what the nature of that conversation will be,” Tavares told reporters.
The Opel-Vauxhall-PSA developments are being looked upon as an indicator of Britain’s ability to retain business investment after the country’s Brexit vote in June.
Setting precedent is an earlier situation with Japanese automaker Nissan, which in 2016 asked Britain for a pledge of compensation if its U.K. plant was negatively impacted by Brexit. After what is believed to be a promise from the government of extra support should the carmaker become less competitive, Nissan went on to invest in the production of two new models at its U.K. plant.