GM talks today

Posted on 17 Nov 2009 by The Manufacturer

Nick Reilly, General Motors’ head of operations in Europe, is due to meet today with business secretary Lord Mandelson to discuss the future of Vauxhall employees in the UK following the fall-through of the Magna-General Motors Europe deal.

The union Unite, representing the 5,500 UK workers will also be present at the meeting and will seek assurances against plant closures or large scale redundancies.

GM had agreed to sell its European operation to Canadian car parts maker Magna, which had Russian backing. The US firm reneged on the deal earlier this month though, with chairman Ed Whitacre explaining that in light of an upturn in business for the firm overall it was keen to keep hold of its interests this side of the Atlantic.

Business conditions are in fact so good that GM plans to start paying instalments on its $1.2bn debt to the US government next month, making good on a promise made by Whitacre last month. GM is not obliged to start making payments until 2015.
General Motors Europe operates two Vauxhall plants in the UK; one in Luton and the other at Ellesmere Port on Merseyside.

The latter was given a boost yesterday from GM’s president and chief executive, Fritz Henderson. “We feel very good about the plant,” he said.

“Ellesmere Port is the lead plant building our new Astra. If that’s not a better signal about the future of the plant, I don’t know what is.”

A decision over all Vauxhall and Opel operations in Europe is expected in the next two weeks and at least some jobs are thought likely to be lost in a cost-cutting exercise.

“We know it is disturbing and unsettling to have this hanging over your head for such a period of time and so we intend to take that decision in a relatively short period of time,” said Reilly, speaking recently to GM workers in Europe.