LONDON -- General Motors' potential sale of its Opel/Vauxhall operations to PSA Group has led to fears that factories in the UK may be shuttered.
The UK, where Opel cars are sold as Vauxhalls, is GM's fourth-biggest market after the U.S., China and Brazil. GM has two vehicle plants in England.
Len McCluskey, head of the Unite union, is asking for assurances from GM that the UK plants and their "loyal" workforces will be retained. "I will also be seeking urgent conversations with the (UK) government because everything must be done to secure our world-class automotive industry," he said in an emailed statement.
GM builds the Astra compact car in Ellesmere Port, northwest England, and light commercial vans in Luton, near London. The plants employ 4,500 people.
Unite said GM had given a private assurance last year that there would be no surprises in terms of its plants in Britain, and that these commitments had not been upheld. McCluskey was due to meet UK business minister Greg Clark on Wednesday. The Department for Business said the government remained in close contact with GM and was monitoring the situation.
Ellesmere Port is vulnerable to closure because local parts content is 24 percent, compared with a 41 percent average for UK car plants, said Garel Rhys, a motor industry academic at the Cardiff Business School. "It is less anchored in the UK than others. If you tipped the table, Ellesmere Port would fall off first," Rhys told Automotive News Europe.
The factory shares production of the Astra with a GM factory in Gliwice, Poland, and there have been fears in the past that the Polish factory could become the sole production facilities for European Astra models.
Brexit hit
UK plants are already vulnerable after the country voted to leave the European Union. The EU could impose tariffs of 10 percent on cars exported from the UK to mainland Europe. The tariffs could make Ellesmere Port and Luton uncompetitive in the tight-margin mainstream market. "Brexit is a complication the British car industry could do without," Rhys said.
Ellesmere Port was due to be shut in 2012 but a deal with unions persuaded GM to keep it running and close an Opel factory in Bochum, Germany, instead. Ellesmere Port started building the latest-generation Astra in 2015 "securing the plant's future well into 2020s," GM said at the time.
Last year the plant built 120,000 cars, up from 70,000 in 2014, and is now considered by industry watchers to be profitable.
The Luton plant last year built 73,000 units of the Opel/Vauxhall Vivaro light van, a rival to the Ford Transit. The van was developed alongside Renault's Trafic, but GM no longer produces the French-badged van in Luton.
No. 2 brand
Vauxhall is the UK's No. 2 brand by sales after Ford Motor with a volume of 250,955 last year, down 7 percent, giving the brand a 9.3 percent market share, according to industry association SMMT. Ford's sales fell 5 percent to 318,316 for an 11.8 percent share. The total market was up 2 percent.
PSA closed its Ryton factory in Coventry, central England, in 2007 after it became unprofitable to import parts to build cars that would then be exported back to mainland Europe. Like Ellesmere Port, Ryton sourced very few parts in the UK. PSA inherited the plant as part of a buyout of Chrysler's struggling European division in 1978.
Reuters contributed to this report
