Union’s fears over Ellesmere Port plant as Fiat plans Vauxhall takeover
UNION leader Tony Woodley says the Government must step in to secure the long-term future of Vauxhall’s factories after Fiat proposed a takeover of the car manufacturer.
Italian group Fiat is considering buying the European arm of troubled US business General Motors, which includes Vauxhall and its 2,000 workers at the Ellesmere Port plant. Fiat may merge its own car-making operations with GM’s European arm, which includes German company Opel, and its 20% interest in manufacturer Chrysler, which entered bankruptcy protection in the US last week. The firm said that would create a car giant with around £71bn in annual revenues.
Merseyside-born Mr Woodley, joint general secretary of union Unite, says the move worries him as it could mean job losses across Europe.
Ellesmere Port is seen as one of GM’s most efficient European plants and will later this year start building the new generation Astra car in a move that should secure its long-term future.
But Mr Woodley, who once worked at the site, says he wants the Government to work with GM Europe to ensure Vauxhall’s 5,000 UK jobs are preserved.
He said: “These proposals are not so much a Sale
as a giveaway. Fiat has struggled for years to get back into profit and now they want to swallow two elephants – GM Europe and Chrysler – simultaneously.
“Inevitably, plants will be reduced across the EU if this takeover goes ahead, and there are real questions over what this will mean for UK plants where Fiat already owns similar operations. Quite frankly, this move sends shivers down my spine.
“In a perfect world, GM Europe should stay part of the global GM family, but if that is not to be the case then my preferred solution is that our government, in conjunction with the German and Spanish governments, takes some ownership which would stabilise the industry and this company.
“If our government is serious about manufacturing, as I believe it is, and serious about ensuring manufacturing will be key to seeing this country out of the recession, then I urge them to do the sensible thing and act to protect our plants.”
Vauxhall was founded in London in 1903. It has been wholly-owned by the General Motors group since 1925 and is responsible for around 20% of GM’s European revenues.
Fiat’s chief executive Sergio Marchionne will assess the viability of the merger in the next few weeks, with the aim of ensuring “the most favourable conditions for the strategic development of the automotive sector”, the firm said.
In an interview with the Financial Times, Mr Marchionne said the potential deal was a “marriage made in heaven” from an industrial and engineering point of view.
The new company would sell up to 7m cars a year, making it second only to Toyota in the global market.
Mr Marchionne met politicians and European officials in Germany yesterday to press the case for the deal.
Financial analysts said a Fiat/GM deal could make sense for both companies but said Fiat would have to reassure governments about any cost-cutting plans.
Business analyst Michael Tyndall, of Nomura International, said: “It’s all very well to say they (Fiat and GM Europe) compete broadly in the same markets with similar platforms and there may be economies of scale. But the broad translation of ‘economies of scale’ is ‘fewer jobs’ and I’m not sure if the Italian or German governments have the appetite for the job losses a merger would entail.”
The motor industry is vital to Merseyside’s economy, employing thousands at car plants and their suppliers, but car sales have plummeted during the recession.
Jaguar Land Rover (JLR), which employs 2,000 people at its Halewood plant building Jaguar X-Type cars and Land Rover Freelander 2 4x4s, has been particularly hard hit as demand for premium cars has slowed.
The Daily Post, along with the Liverpool Echo and its sister papers in the West Midlands, is urging the Government to Support JLR by giving it loan guarantees to help it survive the recession. THE DAILY POST