The UK government is 'cautiously optimistic' that there won't be job losses at Vauxhall's UK factories

LONDON — Greg Clark, Britain’s business secretary, said he was “cautiously optimistic” that the sale of the Vauxhall car brand would not lead to job losses at UK factories.

“The conversations that I and the Prime Minister have had, both with GM and PSA, tell me they intend to safeguard the plants, honour their commitments and look to increase the performance and the sales of cars,” Clark said in comments reported by the BBC.

“We want to hold them to those commitments, but the messages we’ve had lead me to be cautiously optimistic,” he said. PSA, which owns Peugeot and Citroen, bought General Motors’ European unit for £1.9 billion ($US2.3 billion) on Monday. 

The acquisition, which include the Opel and Vauxhall brands will make the PSA Group the second-largest carmaker in Europe, after the Volkswagen Group.

Clark is one of the few optimistic voices against a backdrop of Brexit uncertainty. PSA will make a decision next year about whether to continue to build the next generation of Vauxhall Astra in the UK at the Ellesmere Port factory.

The Vauxhall factories at Ellesmere Port and Luton employ around 4,500 people.

Matthias Holweg, Professor of Operations Management at Said Business School in Oxford said: “An absence of heavy-duty political support and the uncertainties of Brexit both count heavily against the long-term prospects for the UK plants.”

“Potential tariffs for importing components from the single market, and for exporting finished vehicles back to the single market represent a risk of considerable significance,” said Holweg.


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