The loss of a third shift on the Astra currently produced at the UK’s Ellesmere Port facility is an important step in making the plant more productive and better placed to secure the next generation Astra, according to GM Europe’s sales and marketing manager Jonathan Browning.
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Browning, speaking yesterday to trade journalists at a press conference in the West Midlands, was responding to suggestions that the recently announced loss of the third Astra shift and output at Ellesmere Port will have adversely impacted its unit costs.
The plant is in competition with other European plants to secure production of the next Astra with one European Astra-producing plant believed to be surplus to requirements under plans to further cut costs in Europe and improve capacity utilisation.
“The shift removal at Ellesmere Port has reduced the employee base to a level which is the right size for the next generation vehicle,” Browning said.
“It is an important step in making the plant more competitive and the loss of a shift should not be seen as providing some sort of self-fulfilling prophecy for eventual closure,” he added.
Browning refused to be drawn on the hypothetical question of what impact the loss of Astra production and closure of Ellesmere Port might have on Vauxhall sales in Britain, where the Astra is Vauxhall’s biggest selling model. It is also the sole surviving passenger car model made by GM in Britain (Vectra production at Ellesmere Port ended in 2004 as Astra production was increased).
“The focus is on getting a successful outcome at Ellesmere Port and building on the progress already made with all stakeholders to get the necessary productivity improvements in place to secure future investment,” he said.
Some analysts have said that the loss of the third shift and output at Ellesmere Port will have made it look less attractive on unit cost grounds on what is a highly cost-sensitive product.
Ellesmere Port, on Merseyside, is in the running with four other European plants to build the next generation Astra, production of which starts in 2009 – but of the five plants in contention for the model, only four are required. Besides Ellesmere Port, the Astra is currently made at Russelsheim and Bochum in Germany, and Antwerp in Belgium. The other plant in contention is Trollhattan in Sweden.
A decision on plant allocation for the next Astra is likely to be taken next year.
An analyst at JD Power recently identified GM’s Ellesmere Port plant as one of a group of five European plants that are especially vulnerable to closure over next few years (click here to read).
Browning had earlier told delegates at a retailing conference (autoretailing ‘06) that GM was making good progress in Europe, reinforced by its return to profitability in the region with net income of USD88m in Q1 versus a loss of USD92m in the same period of last year.
Dave Leggett
