Vauxhall: Future of Ellesmere Port hangs in the balance

Mr Tavares said the fate of Ellesmere Port will depend on the UK government's comittment to the car industry

The head of Vauxhall's parent company has warned that it will no longer invest in pure diesel or petrol cars at its Ellesmere Port plant.

Carlos Tavares said the future of the Cheshire plant depended on where his company, Stellantis, decided to make new-generation of electric vehicles.

He said a decision would be made in the next few weeks, and depend on the UK government's support of the car sector.

Over 1,000 people work at the plant, with many more in the supply chain.

The future of the Ellesmere Port plant is far from certain. It currently builds an old model of the Vauxhall Astra, due to be superseded by a new version next year.

That new model will be built in two plants - one of them at Ruesselsheim, in Germany. The parent company had previously said it hoped to make it in Ellesmere Port as well.

However, the government's decision to ban the sale of new petrol and diesel cars from 2030 - with the exception of some hybrids - has impacted that decision.

"If governments create situations that destroy the business model, we stop investing of course", said Mr Tavares.

"If we are told that in 2030 internal combustion engines cannot be sold in the UK - which we respect as a decision from the country - then are not going to invest in internal combustion engines any more. Because that makes no sense", he added.

EU market

However, Ellesmere Port could still be used to build an electric or hybrid version of the new car.

Mr Tavares said he welcomed the trade agreement reached between the UK and the EU - and added that the terms of the deal meant electric cars could now be built in the UK or in continental Europe.

On paper, he said, it might make more sense to invest in Europe, because "the biggest market is on the continental Europe side".

However, he said, there were other factors to consider. "It depends also on the UK government's willingness to protect some kind of automotive industry in its own country, which is about their strategy. So we are now reviewing those scenarios."

Mr Tavares was speaking at a press conference to mark the $50bn merger of Vauxhall's parent company, PSA Group, with the Italian-American company FiatChrysler.

Restrictions

He said the creation of the new company, Stellantis, would not in itself lead to any plant closures. It would instead act as a "shield" to commercial pressures which could lead to job losses, he said.

But he stressed that the fate of Ellesmere Port itself should be linked to the actions of the UK government, not the merger.

"If you change brutally the rules, and if you restrict the rules for business, then there is, at one point in time a problem.

"The more we put stringent objectives on industry, the more you get close to that limit", he warned.