Vauxhall owner considers UK factory closures: decision to be made ‘in a few weeks’

Vauxhall’s owner will decide within ‘the coming weeks’ whether to close its UK factories.

Stellantis, Europe’s second-largest carmaker, has been weighing its options for months amid a row with the government over quotas for electric vehicles (EVs).

In an update yesterday, boss Carlos Tavares urged ministers to relax the rules to safeguard the future of his factories in Ellesmere Port and Luton.

“We are now reaching a point where we have to make a decision, and that will happen in the coming weeks,” he told Bloomberg TV yesterday.

The dire warning comes at a time when demand for electric cars is falling across Europe.

Drivers are reluctant to buy electric vehicles due to high prices and lack of charging infrastructure.

Tavares urged the government to “help stimulate demand” if they want companies like Stellantis to sell a greater share of electric cars. He said the government’s threshold for green sales is about double the “natural” demand level.

The grim warning came as Sir Keir Starmer welcomed major companies to an investment summit in London.

Stellantis, formed from the merger of Fiat Chrysler and Peugeot and Citroen owner PSA, makes electric cars and vans at its Ellesmere Port plant and larger petrol and diesel vans in Luton.

It planned to start producing electric vehicles in Luton later this year.

The government’s targets require that 22 percent of manufacturers’ car sales this year must be emission-free. This is expected to rise to 80 percent by 2030.

For vans, 70 percent of new sales should be electric by the end of this decade. Companies could be fined up to £15,000 per vehicle if they fail to meet these targets.

There are signs that consumers are turning their backs on green models amid increased competition from Chinese automakers.

And British motorists are put off by battery-powered cars because of their high price tags. Figures published earlier this month show that just 92,627 battery-only cars were registered in the European Union last month – a 44 percent drop on August last year.

The European Automobile Manufacturers’ Association (ACEA), which published the figures, stated that the EV market is “now on a continued downward trajectory.”

The ACEA urged European governments to delay draconian green targets, claiming that the refusal to extend the 2035 deadline for ending petrol and diesel car production “raises the daunting prospect of multi-billion dollar fines euros or unnecessary production cuts and job losses.