2,100 UK jobs at risk as GM exit rumours grow louder

Posted on 15 Feb 2012

Business Secretary Vince Cable met with executives at the car manufacturer General Motors to urge the firm not to close the Ellesmere Port plant operated by its subsidiary Vauxhall. 

Speculation has grown in the US that the car maker, which received a $6.7bn bailout from the US government in 2008, is reviewing its European operations ahead of the company’s fourth quarter results on Thursday 16, February.

General Motor’s loss-making operations in Europe led to a report in the Wall Street Journal claiming that the firm’s Vauxhall plants in Ellesmere Port, Merseyside, and Bochum, Germany were being considered for closure.

GM employs over 2,000 people at Ellesmere Port, which manufacturers the firm’s Vauxhall Astra line. Vince Cable is thought to have emphasised Ellesmere Port’s strong performance to General Motors executives.

Detroit-based General Motors has recovered strongly in the US since its government bailout as a surge of Americans buying American-made goods took place. At the company’s last quarterly results in November 2011, General Motors reported that its sales stayed in profit for the seventh successive quarter and achieved a net income of $1.7bn for the third quarter of 2011.

However, the results showed that losses continued across General Motor’s European operations. Q3 sales figures were $292m in the red and the Thursday’s results are expected to be around the minus $190m mark. This has led to arguments of overcapacity in the region as sales have fallen from 1.81m units in 2007 to 1.26m during 2011.

General Motors Europe is already cutting 8,000 jobs in a restructuring programme that included the closure of a plant in Antwerp, Belgium, as part of an intention not close any further European factories until 2014.