The sale of General Motors’ European operations to car parts giant Magna, backed by the Russian Sberbank, has left the Vauxhall workforce concerned that the Ellesmere Port and Luton plants will close. But last night Lord Mandelson said the company was committed to Vauxhall’s future.
”I’m glad the immediate uncertainty about GM’s future has been removed,” he said. ”We must now hope this GM/Magna/Russian deal will bring stability in the longer term.
”I have had four face-to-face meetings with Magna in the last couple of months. I am satisfied about their commitment to Vauxhall’s plants.
”The Government will now discuss our share of the funding of the deal and I expect to tie down the details of this in the near future.”
But union officials fear the sale, brokered by the German government, may lead to more job losses in the other European countries where GM has factories.
Workers leaving Vauxhall plants yesterday said they felt ”devastated” by the development, following earlier speculation that GM had decided against a sale.
The Government stressed that it was inevitable there would be restructuring of the business which would affect Germany as well as other countries.
Business Minister Pat McFadden said: ”Our objective throughout has been to get the best possible outcome for the Vauxhall workforce and the production plants in the UK.
”We have been in close contact with all parties throughout, including GM in the US and Europe and all the potential bidders.
”Now GM has announced its preferred bidder is Magna, we will continue our discussions with Magna. They have told us of their commitment to continuing production at both Ellesmere Port and Luton and we will work to make sure we get the best possible outcome for the UK.”
Unite union joint general secretary Tony Woodley said: ”The uncertainty surrounding the ownership of Vauxhall is now over, but the uncertainty surrounding the long-term future of Britain’s plants will continue.
”One of the alternatives could have been the unthinkable position of liquidation. Nevertheless, with Magna as the new owner, we need to make sure that British plants and people are not treated disproportionately during the restructuring that will take place. With that in mind, the union and the Government will no doubt continue to negotiate with Magna.
”We expect financial support from the UK Government for Magna to be dependent on the job and plant commitments given by the company.”
Unions had been pressing GM not to sell its European business, believing this would be the best option for securing jobs in the UK.
Magna said it would honour existing contracts at Luton until 2013, but has not given any commitment beyond this point.
Source: Daily Telegraph