GM sees 'significantly' fewer Vauxhall job cuts

Restructuring plan will be 'no worse' than Magna's / Unions welcome 'positive' talks on future of UK plants

General Motors raised union hopes that there could be fewer redundancies at Vauxhall now the US parent company has decided not to sell the historic car marque.

Meetings between GM executives, the Government and trade unions yesterday were described as "positive" by all sides. The talks were the first opportunity for the players, who had spent months negotiating the sale of GM's European operations to Magna International of Canada, to meet Nick Reilly, the GM executive transferred to the head the division and to draw up the alternative way forward.

There were noticeably optimistic signals for the UK from GM yesterday. Mr Reilly said the group's initial position with regards to potential job losses is "no worse" than the proposals from Magna. He also said that there is the "opportunity to reduce, probably quite significantly" the number of voluntary redundancies from the 800 outlined by Magna for the Ellesmere Port and Luton plants.

But despite repeat commitments of funding from Lord Mandelson, the Business Secretary, it will be three weeks at least before the details of the €3.3bn (£2.9bn) restructuring plan – and what it means for UK jobs and factories – are made public.

Lord Mandelson and trade union bosses from Unite were just one stop on a Europe-wide itinerary for Mr Reilly, who is hawking the company's plans around all the governments and trade unions that need to support it.

The company needs to cut between a fifth and a quarter of the capacity of its loss-making Vauxhall/Opel business. But until there is unanimous agreement, and GM has raised the necessary funding in the form of loans or loan guarantees, the company will give no indications of where the expected 10,000 jobs cuts will fall or which countries might face factory closures.

"I would hope that manufacturing in the UK is maintained and I would include both Ellesmere Port and Luton in that statement," Mr Reilly said. "UK manufacturing strength is strategically good for us and they are good plants." The €3.3bn that GM needs will pay for the restructuring costs, help the company to weather what Mr Reilly acknowledges will be "a tough year" in 2010, and give the company enough cash to keep investing.

The company is keen to stress that there is no bidding war between European governments hoping to buy a reprieve for domestic jobs or factories. "The funding is only short-term and we would expect to pay it back in two or three years as the market picks up," Mr Reilly said. "So we are looking for a funding package that makes sense and we are not going to allocate certain volume to a country if they give more loans or vice versa."

Following yesterday's discussion, the UK government was bullish about the future for Vauxhall. Lord Mandelson said: "We will continue our discussions, but the future for Ellesmere Port and Luton looks positive. GM will be looking for financial support and the UK is prepared to underwrite it."

There is also the potential for GM to put some of its own money into the plan for Vauxhall/Opel. Before and during the bankruptcy of the US company, none of the funding provided by the US government was allowed to leave the country. But since GM came out of Chapter 11 bankruptcy protection in July, some flexibility has been granted – not least because the US government, as a 60 per cent shareholder, wants the best outcome for the company. GM has already been to Germany to discuss the restructuring plan, despite a war of words with German politicians in the aftermath of its U-turn.

Nick Reilly: GM's man with a plan

British-born Nick Reilly is not only the man charged with putting together the plan to re-structure GM's European business and turn it from a loss-making dead weight into a lean and profitable powerhouse – a task that will draw heavily on his highly reputed skills as a negotiator and his grasp of GM's business in international markets. Mr Reilly is also GM's president of international operations and a former managing director of Vauxhall.

Cambridge-educated Mr Reilly already has more than three decades with GM under his belt, including 15 years at Vauxhall in the 1980s and 1990s that included a spell as director of manufacturing at the Ellesmere Port factory and culminated in five years as chairman and managing director. From there, he moved to Zurich before heading for Asia, first to Daewoo in South Korea and ultimately, from July, as the Shanghai-based head of international operations.

Mr Reilly was called on to run the European business last week, pending the recruitment of a replacement for Carl-Peter Forster, the former boss who left in the wake of GM's U-turn on the plan to sell the European arm to Magna.

News
Jeremy Paxman has admitted he is a 'one-nation Tory' and complained that Newsnight is made by idealistic '13-year-olds' who foolishly think they can 'change the world'.
peopleFormer Newsnight presenter is being touted for a brand new role
News
Michael Buerk in the I'm A Celebrity jungle 2014
people
Voices
File: David Cameron offers a toast during a State Dinner in his honour March 14, 2012
voicesAnd nobody from Ukip said babies born to migrants should be classed as migrants, says Nigel Farage
Arts and Entertainment
Avatar grossed $2.8bn at the box office after its release in 2009
filmJames Cameron is excited
PROMOTED VIDEO
News
ebooksNow available in paperback
News
The Magna Carta
archaeologyContemporary account of historic signing discovered
Arts and Entertainment
Stik on the crane as he completed the mural
art
Arts and Entertainment
Phyllis Dorothy James on stage during a reading of her book 'Death Comes to Pemberley' last year
peopleJohn Walsh pays tribute to PD James, who died today
Sport
Benjamin Stambouli celebrates his goal for Tottenham last night
FOOTBALL
Life and Style
Dishing it out: the head chef in ‘Ratatouille’
food + drinkShould UK restaurants follow suit?
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Argyll Scott International: Service Desk Analyst

£20000 - £22000 per annum: Argyll Scott International: Service Desk Analyst Re...

Argyll Scott International: 2x Service Desk Analyst

£20000 - £22000 per annum: Argyll Scott International: Service Desk Analyst Re...

Recruitment Genius: Senior Execution Trader

£30000 - £250000 per annum: Recruitment Genius: A global Rolling Spot FX, Comm...

Citifocus Ltd: ACA - Financial Reporting

£Attractive Package: Citifocus Ltd: Chartered accountant (ACA or CPA), must be...

Day In a Page

Homeless Veterans Christmas Appeal: ‘We give them hope. They come to us when no one else can help’

Christmas Appeal

Meet the charity giving homeless veterans hope – and who they turn to when no one else can help
Should doctors and patients learn to plan humane, happier endings rather than trying to prolong life?

Is it always right to try to prolong life?

Most of us would prefer to die in our own beds, with our families beside us. But, as a GP, Margaret McCartney sees too many end their days in a medicalised battle
Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night - is that what it takes for women to get to the top?

What does it take for women to get to the top?

Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night and told women they had to do more if they wanted to get on
Christmas jumper craze: Inside the UK factory behind this year's multicultural must-have

Knitting pretty: British Christmas Jumpers

Simmy Richman visits Jack Masters, the company behind this year's multicultural must-have
French chefs have launched a campaign to end violence in kitchens - should British restaurants follow suit?

French chefs campaign against bullying

A group of top chefs signed a manifesto against violence in kitchens following the sacking of a chef at a Paris restaurant for scalding his kitchen assistant with a white-hot spoon
Radio 4 to broadcast 10-hour War and Peace on New Year's Day as Controller warns of cuts

Just what you need on a New Year hangover...

Radio 4 to broadcast 10-hour adaptation of War and Peace on first day of 2015
Cuba set to stage its first US musical in 50 years

Cuba to stage first US musical in 50 years

Claire Allfree finds out if the new production of Rent will hit the right note in Havana
Christmas 2014: 10 best educational toys

Learn and play: 10 best educational toys

Of course you want them to have fun, but even better if they can learn at the same time
Paul Scholes column: I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season

Paul Scholes column

I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season
Lewis Moody column: Stuart Lancaster has made all the right calls – now England must deliver

Lewis Moody: Lancaster has made all the right calls – now England must deliver

So what must the red-rose do differently? They have to take the points on offer 
Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

Sol Campbell cries foul at Labour's mansion tax

The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

Sarkozy returns

The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
Is the criticism of Ed Miliband a coded form of anti-Semitism?

Is the criticism of Miliband anti-Semitic?

Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

Ouija boards are the must-have festive gift

Simon Usborne explores the appeal - and mysteries - of a century-old parlour game