Government 'seeking talks' with French group over future of UK car workers

The Government is understood to be seeking crunch talks with Peugeot-owner PSA Group as fears grow over the future of thousands of British jobs at Vauxhall.

Business secretary Greg Clark wants to speak with the French automotive giant at the earliest opportunity following news that General Motors (GM) could sell Vauxhall and Opel to PSA Group, the Press Association has learned.

It comes after Mr Clark spoke to GM president Dan Ammann on Tuesday to raise concerns about a potential acquisition of Opel Vauxhall.

Vauxhall employs 4,500 staff at plants in Ellesmere Port and Luton, with a further 300 people working in a customer contact centre and 120 at its OnStar headquarters.

Around 23,000 people also work in Vauxhall's retail network, while 7,000 jobs rely on the firm's UK supply chain.

It comes amid reports that the GM chief executive Mary Barra has flown to Germany in a bid to head off union concerns over potential job losses at Opel.

PSA chief executive Carlos Tavares is also looking to meet with the German chancellor Angela Merkel and union representatives this week as he looks to push the deal through, according to the Financial Times.

Such a deal would see GM exit UK and Europe, while transforming PSA Group into Europe's second-largest carmaker with a 16% share of the European market.

The US motor giant behind Chevrolet and Cadillac has acknowledged talks were taking place, but cautioned that ''there can be no assurance that an agreement will be reached".

Unite general Len McCluskey has called on the Government to extend the assurances offered to Nissan over Brexit to the rest of the UK car industry to help secure jobs at Vauxhall.

Following a meeting with Mr Clark, Mr McCluskey said Unite had stressed to the Government that it ''will not accept any job losses or plant closures as a result of this move''.

He said ''without shadow of doubt'' Vauxhall's UK plants must be offered the same level of certainty over their future as Nissan.

Nissan announced in October that it was investing in production of new Qashqai and X-Trail models at Sunderland after receiving Government assurances that EU withdrawal would not affect the plant's competitiveness.

Mr McCluskey said the future of UK car workers' jobs should not lie in the hands of French government-backed Peugeot, as he urged ministers to take decisive action.

''It does seem as if Brexit is a factor in this decision as GM does rely heavily on its links throughout the EU supply chain, so once again I stressed to the minister that we need them to be clearly committed to securing access to the single markets for the UK autos industry.

''This can be done, in our view, while controlling access to the labour market so it is vital that the Government thinks again about its priorities for UK manufacturing.

''It also makes it even more vital that the Government takes this opportunity to work with the sector to bring the production of car components back to the UK so that we can run our businesses without facing bruising tariffs.''

Mr McCluskey said he will now seek talks with GM and PSA Group as ''a matter of urgency'' to better understand their plans for the UK workforce.

GM said last year that it had to raise UK car prices by 2.5% after the plunge in the value of the pound following the EU referendum result caused the British car industry to hit a ''speed bump''.

Announcing its full-year results last week, the Detroit-based firm said GM Europe had narrowed losses to 257 million US dollars (£206 million) in the year to the end of December, from a loss of 813 million US dollars (£651 million) the year before.

GM and PSA Group formed an alliance in 2012 in an attempt to make production more efficient by combining purchasing power and larger scale.

GM will make Citroen's forthcoming subcompact crossover vehicle beginning later this year at its plant in Zaragoza, Spain.

A spokeswoman for the Government's Department for Business, Energy and Industrial Strategy (BEIS) declined to comment on potential talks between Mr Clark and PSA Group.

She added: "The UK's automotive sector is one of the most productive in the world and we want to see it go from strength to strength. The Government will continue to make the case for keeping manufacturing in the UK."