Ministers Informed in July of ‘Likely’ Vauxhall Plant Closure

The business secretary has stated that he was informed the Vauxhall van manufacturing facility in Luton was “likely to close” merely 10 days after the general election in July. Labour minister Jonathan Reynolds conveyed to the Commons that Carlos Tavares, chief executive of Stellantis, the company owning Vauxhall, expressed feeling “extremely frustrated” by the previous Conservative government’s lack of action, which resulted in “his desire was to close the Luton plant”. In a statement, he affirmed that the government had done “everything it possibly could” to prevent the closure and that he had met with Stellantis “many times” since the summer. Andrew Griffith, the Conservative shadow business secretary, contended that Stellantis made the decision to close its factory after Labour’s budget “declared war on business”. Stellantis’s intentions to shut down the factory in the Bedfordshire town have jeopardised 1,100 jobs. The company announced it would consolidate its electric van production at its other UK plant located in Ellesmere Port, Cheshire. Rules implemented to accelerate the transition to electric vehicles in the UK partly influenced the decision, according to the firm. Reynolds told the Commons that the new government had been compelled to accept this was “a commercial decision by Stellantis as they respond to wider challenges within the sector”. Reynolds described it as a “dark day for Luton” and added it was “an iconic plant powered by a talented workforce… there are very few people in the town who do not know someone who works at the site”. He further stated that the government had requested the company “to urgently share its full plans” and hoped it would “work with the government so every single worker who is impacted receives the support they deserve”. The preceding Conservative government shifted the deadline for phasing out new petrol and diesel vehicle sales from 2030 to 2035. Under the current mandate, electric vehicles must account for 22% of a company’s car sales and 10% of its van sales this year. That target is projected to increase to 28% for cars and 16% for vans in 2025. Labour indicated its intention to reinstate the 2030 target as part of its broader commitments to climate change policy, but would consult on how the “direction of travel” for the policy would function. Responding to criticism of the former Conservative administration, Griffith asserted that the policy encouraged Stellantis to cease operations. “This decision is the direct result of a government policy that is simply unworkable for industry,” Griffith told MPs. He added, “Businesses are ringing the alarm bells… Pressures on businesses are too much to swallow.” Sarah Owen, the Labour MP for Luton North, characterised the closure decision as “callous” and stated it would affect “the whole town and the region”. She further noted that the proposed shutdown of a “manufacturing giant that Luton helped build” would follow the closure of the SKF ball bearing factory in her constituency last month, after a century of manufacturing, calling both companies “synonymous with Luton”. Rachel Hopkins, Labour MP for Luton South & South Bedfordshire, informed the Commons that friends of hers had discovered yesterday they had lost their jobs, and asked the business secretary if he would meet with workers at the plant. Reynolds confirmed he would visit the site. In response to a question from Chris Hinchliff, the Labour MP for North East Hertfordshire, Reynolds confirmed he had held “several conversations” with the Unite union but conceded that a Stellantis proposal to offer workers a relocation package to Ellesmere Port “would not be attractive” to many of them. Blake Stephenson, Mid Bedfordshire’s Conservative MP, stated that the government had disclosed very little “about how it would offer support” to workers. Stephenson, whose constituency is home to many workers north of Luton, added that he was concerned Labour’s “tax on jobs” would make it challenging to replace the 1,100 manufacturing roles at risk. In reply, Reynolds described the staff as “skilled and talented” and asserted that they had not potentially lost their jobs “through any deficiencies on their part”. He concluded by saying they were “brilliant and talented people who would be in demand elsewhere”.