• No compulsory redundancies at either Vauxhall plant
  • 600 jobs saved from original 1,200-post Magna proposal
  • Ellesmere Port, subject to maintaining its competitive position, to make next generation Astra from 2016
  • Luton van plant staying open; Magna to seek "any other possibility on product" once current van contracts end
  • Two shifts at Ellesmere Port with volume agreed at 147,500 by 2011 irrespective of demand fluctuations

After weeks of negotiations, General Motors Europe's UK unit Vauxhall, Magna International and the Unite union have agreed a plan that halves the number of job losses the successful bidder for Opel/Vauxhall had originally proposed.

As part of a wider cost-saving deal, 600 posts will be lost but all redundancies will be voluntary, Vauxhall communications director Denis Chick confirmed on Tuesday afternoon.

"They [workers, union and management] worked very hard on this one," Chick told just-auto.

Unite - the equivalent at Vauxhall of the United Auto Workers at GM plants in the US - described the agreement as "a fairer deal for the UK, giving the plants at Ellesmere Port and Luton improved prospects for the future".

Joint general secretary Tony Woodley said: "This agreement removes the uncertainty surrounding our plants and our people's jobs. It gives both plants job security and a future through to 2013, providing a good basis for a long-term future beyond that.

"[Opel/Vauxhall Astra] production at Ellesmere Port will grow significantly from the level originally proposed to nearly 148,000 units, with full capacity over two shifts, and there is agreement that Luton [a van JV with Renault] will remain a key manufacturing site.

"Some 600 jobs that would otherwise have been lost will be preserved, but equally as important, Magna has agreed to no enforced redundancies.

"Agreement has now been reached with the workforce in this country. We would urge that each and every government involved in the European operations, including that in the UK, now wastes no time in finalising the financial contribution which they will make to this business."

The agreement between Unite and Magna states that:

  • Ellesmere Port, subject to maintaining its competitive position, will produce the next generation Astra (scheduled for 2016; it has just begun production of the 2010-2016 hatchback line)
  • The Luton van plant will be maintained as a key site within Magna's UK portfolio, and Magna will seek "any other possibility on product" for the plant
  • There will be no compulsory redundancies at either UK plant
  • There will be two shifts at Ellesmere Port with volume agreed at 147,500 by 2011 irrespective of demand fluctuations

In return, United said, the workforce will contribute through cost-saving and efficiency measures. These, Chick confirmed, included the 600 voluntary redundancies.

There will also be a two year pay freeze (although weekly working hours will rise helping to bridge the earnings gap) and increased contributions to the car purchase scheme of GBP20 per month.

Unite joint general secretary Derek Simpson added: "When we started off this process, we made it clear that we were seeking a fairer arrangement for the UK plants, and that is what has been achieved.

"The UK government, chiefly the prime minister and [industry secretary Peter] Mandelson, has been pivotal to reaching agreement today. Their support has ensured we can preserve and maintain the 25,000 jobs in manufacturing and services and the 403 components companies which depend on Vauxhall, and would have been at serious risk had agreement not been reached.

"This is testimony to the success of the government's approach, which is not to stand idle and let the market prevail but to intervene to protect the best in British industry.

"Unite thanks them for their work because through their efforts they have made sure that our plants can have a future."

United said talks between Magna and the works councils of the other European nations were continuing.

Vauxhall said in a statement: "We are pleased that the parties have secured an agreement that protects the jobs and prospects of the circa-5,000 Vauxhall employees in the UK.

"This is very good news for Vauxhall's UK operations and is the result of a tremendous team effort between leadership of Unite and [our] management team."

Reports today said Magna and Opel would finally sign a deal - which Chick last week described as a "memorandum of understanding" - next Thursday (15 October).

Earlier analysis here