The future of Vauxhall in the UK is safe, thanks to EV

Source: BBC News Business – Theo Leggett: Business Correspondent

Vauxhall owner Stellantis has announced plans to build electric vans at its Ellesmere Port plant in Cheshire.

It produced its first car, the Vauxhall Viva, in 1964, and produced the Viva, Chevette, and Vauxhall and Opel Astra.

The £100m investment, which the UK government will contribute to, will safeguard more than 1,000 factory jobs.

The future of the plant has been in doubt after Vauxhall’s parent company scrapped plans to build its new Astra model there.

The Ellesmere Port plant will also make electric passenger car models for Vauxhall, Opel, Peugeot and Citroën.

Production of an all-electric van will start in 2022, the car-maker said.

The government has held talks with Stellantis about options for the Cheshire factory and ministers are understood to have offered about £30m in financial support.

‘Global Race’

Carlos Tavares, head of Stellantis, had previously warned that the company would no longer invest in pure diesel or petrol cars at the plant, and said a decision on where it would build electric vehicles would depend on the UK government’s support of the car sector.

Mr Tavares said: “Performance is always the trigger for sustainability and this £100m investment demonstrates our commitment to the UK and to Ellesmere Port.”

Prime Minister Boris Johnson said: “It’s a huge vote of confidence in our economy, in the people of Ellesmere Port, and in our fantastic post-Brexit trading relationships.”

Business Secretary Kwasi Kwarteng said: “Ellesmere Port’s proud tradition in auto manufacturing will continue for many years to come thanks to today’s investment.”

He said that the investment will also “secure thousands of jobs across the region in the supply chain”.

“In this global race to secure electric vehicle production, we are proud to support Britain’s auto sector in this crucial transition as we work to build back better,” Mr Kwarteng added.

Sales of vans have been booming during the pandemic, as a result of growing home delivery sales.

Vauxhall’s Luton plant is currently operating at full capacity so Stellantis wants to expand production at Ellesmere Port to serve the UK market.

Like other manufacturers it is also preparing for an all-electric future. The UK will ban the sale of new petrol and diesel cars from 2030, with other European countries setting similar targets.

Last week, Japanese carmaker Nissan announced an expansion of electric vehicle production at its car plant in Sunderland which will create 1,650 new jobs.

Hollie Hughes, 24, an engineer at the Ellesmere Port plant, who started as an apprentice nearly eight years ago, said the plans were “so exciting”, especially the electric vehicle aspect.

“It’s a massive highlight for Ellesmere Port,” she said, adding that her team will be “heavily involved” in implementing the plans.

Oliver Holden, 27, a manufacturing engineer at the plant, said the employees had waited a long time for the announcement.

“From today, everyone will be pleased – the mood will be lifted, I believe,” he said. “Everyone now can focus on the next challenges and move towards the future.”

The outlook for the British automotive industry is certainly a lot rosier now than it was just a few months ago.

Without investment in new products every few years, car plants die; and the ageing factory at Ellesmere Port has long been regarded as particularly vulnerable.

Earlier this year Carlos Tavares, the acerbic chief executive of Vauxhall’s parent company Stellantis, made it very clear that investment would only arrive if the government itself were prepared to support the industry.

It appears the government has done just that, with both Nissan and Stellantis, pledging to spend serious amounts of money developing electric vehicles here as a result.

But there’s a long way to go to secure the future of car manufacturing, as it prepares for an all-electric future. After years of uncertainty over the outcome of Brexit, which made carmakers reluctant to commit to new plans, the UK is still playing catch-up.