General Motors has raised the drawbridge and manned the battlements to keep media away from its Vauxhall Ellesmere Port plant on the Wirral peninsula near Liverpool in northwest England, a national daily newspaper report said.
The Guardian said the site, which has welcomed just-auto on at least two occasions – is currently a no-go area for media amid ongoing speculation over its future, and staff and suppliers have been told to avoid reporters.
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“Outside the plant, attempts to photograph Astras awaiting delivery at the site’s distribution centre prompt a visit from security guards who ask the Guardian to desist,” the report said.
One supplier, speaking anonymously to the paper, said the mood within was “grim” as the 2,800 workers – made up of Vauxhall employees and 700 contractors – await the outcome of an executive meeting that could be crucial to Ellesmere Port’s future.
The Opel/Vauxhall supervisory board is expected to discuss its business plan for 2012 to 2016, the Guardian said, citing “sources close to discussions over GM’s European business”.
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An estimated 10,000 employees in the supply chain as well as the factory staff are desperate to know whether the next-generation Astra, due to start production around 2015, will be built on the Wirral, the report added. But GM is understood to believe that it is 400,000 units over capacity in Europe – the equivalent of two factories.
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By GlobalDataEllesmere Port and Bochum in Germany are the most likely candidates for closure, sources close to the talks told the paper. GM has said it stands by a labour agreement that bars plant shutdowns before 2014 but the Guardian said the concern is Ellesmere Port will be starved of work and the new Astra contract will go elsewhere. With no new work, the plant will then be vulnerable to shutdown.
“When the shadow of a new model comes up there is a bit of optimism and hope that you can get the model,” the supplier said. “But it’s quite the opposite. It’s all doom and gloom at the moment.”
A voluntary redundancy programme is sending worrying signals, the supplier added: “They are trying to reduce numbers all the time. Some of the people who are putting in for these separation packages are the sort of people you need if you are going to ramp up production.”
The paper said the Wirral site has capacity for 188,000 cars a year but currently only makes 106,000.
Unite’s senior representative at the plant, John Featherstone, told the Guardian the new Astra was key.
Asked about redundancies, he said employees would be needed if Ellesmere Port secured the next Astra contract.
“We should not be looking to get rid of skilled people who can build cars.”
Referring to Ellesmere Port’s reputation as GM’s most efficient European plant, he added: “We don’t want to get rid of a workforce that has exceeded expectations. And when the next generation Astra comes we need people to build it.”
Explaining the media shutdown to the paper, Vauxhall said press attention was unsettling a workforce operating in a competitive market.
“To be and stay competitive is key in the automotive manufacturing environment, where a plant’s performance is tightly measured. The Ellesmere Port plant is very competitive and we need to make sure our employees are able to focus on the job in hand to maintain this. Negative media speculation perpetuating over the last weeks is far from helpful and we therefore do not welcome media speculating on the plant’s future on our premises.”
Coventry University professor and car industry expert David Bailey told the Guardian he believed company politics would play a part in decision-making. Germany is GM’s European heartland and he thought cutting two plants there would be politically and industrially impossible.
“The over-capacity is in Germany but I don’t think they will get two closures past the board without a fight from [the powerful union] IG Metall,” said Bailey.
“If they do go for two plant closures in Germany I think there will be an industrial relations war. They might be able to manage one [closure] without a massive strike. So they need another elsewhere and that is where Ellesmere Port comes in.”
The Guardian noted that questions would be asked here in the UK of the government and its industrial policy if Ellesmere Port was singled out for closure. The Cameron coalition administration has trumpeted a “march of the makers” to diversify the economy away from a financial services sector that accounts for about a tenth of GDP.
Nonetheless, the paper noted, sources close to the talks were complimentary about the government’s work. A Whitehall [central government] source confirmed that minister Vince Cable’s business department was in close contact with GM executives.
Cable has insisted that state aid is not an option, despite a sense among some parties that this is becoming a game of industrial divide and rule as GM sought concessions from individual European workforces and governments.
Bailey told the Guardian Ellesmere Port needed government intervention to secure a long-term future, while new policies were required to avoid a repeat, such as a German-style part-time wage subsidy scheme where the state tops up salaries that have been reduced by shift cuts.
Insiders last year told just-auto that the plant’s product line would probably change if it secured production of the next Astra because it was currently sole source of the wagon variants, 80% of which were being shipped to Europe, while three-door hatchbacks, most popular in the UK, were being shipped from Poland, one of several plants in low-cost countries mooted in a GM internal document seen by other media as capable of taking up any slack from the closure of Ellesmere Port and the Opel Bochum plant in Germany.
GM closed Vauxhall’s original passenger car plant in Luton in 2002. Ellesmere Port, which marks its 50th birthday this year, was built in the early 1960s, for the HA Viva initially, as part of then-government policy to bring manufacturing jobs to economically depressed areas. Only two of the half dozen or so auto plants built in that era survive; the other is Jaguar Land Rover’s Halewood plant, also near Liverpool, originally established by Ford to make the Anglia.
Other recent UK car plant closures include MG Rover’s Longbridge facility, after that automaker went bust in 2005 with the loss of 6,000 jobs, and PSA’s Peugeot plant in Ryton, east of Coventry, where 2,000 jobs were lost, in 2007.
