PSA agrees £1.7bn takeover of Vauxhall and Opel
PSA, the French owner of the Peugeot and Citreon car brands, is going ahead with its £1.7bn acquisition of the loss-making General Motors-owned UK car company Vauxhall and German equivalent Opel.
Already, the deal announced today (Monday, March 6) has raised fears over possible job losses at Vauxhaull’s UK factories at Ellesmere Port in Cheshire, and Luton, Bedfordshire which employ about 4,500 workers split equally between the sites.
Thousands more workers are involved in Vauxhall’s showrooms and supply line.
When the agreement is complete, PSA will become Europe’s second largest car manufacturer behind Volkswagen but ahead of Renault-Nissan.
Officials of the union Unite said that staff at plants at Ellesmere Port and Luton had endured a “nerve-wracking” few weeks since talks were first announced on February 14.
General secretary Len McCluskey said he had spoken to the chief executives of GM and the PSA Group over the weekend.
He said: “While initial discussions with the PSA Group have been relatively positive, our priority now is to ensure a long-term future for our plants and the tens of thousands of workers depending on them.”
PSA and GM Europe sold a combined 4.3 million vehicles last year and posted revenues of £61.9bn, with the companies already sharing some production operations.
Opel had hoped to return to profitability by 2016, but the slide in sterling following the EU referendum last June contributed to its 257m euros annual loss.
Meanwhile, Ford Europe made a pre-tax profit last year despite the pound’s demise.
Opel has not been able to emulate Ford or PSA in reducing overcapacity at its factories, despite closing a plant in the western German city of Bochum with the loss of 3,000 jobs in 2014.
GM’s European operations have lost money for 16 consecutive years and were almost sold in 2009.
The deal caps a stellar two-year recovery for PSA under chief executive Carlos Tavares, who is expected to slash costs at Opel in a bid to generate savings of up to 2bn euros a year.
