January 22, 2018 / 10:43 AM / a month ago

UK union chief meets Peugeot boss to defend Vauxhall car plant

LONDON, Jan 22 (Reuters) - The head of Britain’s biggest trade union was meeting Peugeot’s boss on Monday to call for fresh investment in its Vauxhall car plant after the French automaker said it would cut around a third of the workforce to combat inefficiencies.

Peugeot acquired Vauxhall and Opel last year when it bought General Motors’ loss-making European arm, and has been pursuing a restructuring plan to return it to profitability.

The Ellesmere Port plant in northern England builds the Astra Sports Tourer. Peugeot is due to decide as soon as this year whether to build future models at the site -- a key test of Britain’s ability to remain competitive as it leaves the EU.

The general secretary of the union Unite was due to meet Peugeot-maker PSA’s chief executive, Carlos Tavares.

Two weeks ago, the firm said it would cut a further 250 jobs at the site on top of 400 losses announced last year, when the plant employed 1,900.

“When I take my seat opposite Mr Tavares, I’ll be saying ‘Give us that new model’,” Unite’s Len McCluskey wrote in the Liverpool Echo local newspaper ahead of his visit. “Then we can discuss the changes PSA may seek.”

Peugeot has said that manufacturing costs in Britain are twice those of its French plants, and that it will only be able to make a decision on future investment once this has been addressed, and it has a better idea of the shape of Britain’s future trading relationship with the EU.

Britain hopes to secure the outline of a transitional Brexit deal, which will bridge the country from its current EU membership into a new relationship with the bloc, by the end of March.

Automakers are concerned that, without the right deal, their plants could be hit with tariffs and customs delays, putting their long-term viability at risk.

Tavares met Britain’s business minister this month.

A Peugeot spokesman said Monday’s meeting would “cover a broad number of aspects relating to the UK business”.

Vauxhall’s other British factory, in Luton, makes the Vivaro van. (Reporting by Costas Pitas; Editing by Kevin Liffey)

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