The next generation of Vauxhall's Vivaro van is to be built at its Luton factory, safeguarding the plant and over 1,000 jobs, it was announced tonight
There had been fears the site could close if the current contract between Vauxhall and Renault was not renewed after it runs out in 2013.
Unite said it was "fantastic news" which had ended uncertainty over jobs.
Vauxhall said the Luton plant will continue to play an "important role" in the company's manufacturing network.
Nick Reilly, president of General Motors Europe, which includes Vauxhall in the UK and Opel in Germany, said recently that a decision was imminent, adding that all options were still under consideration.
Unite union general secretary Len McCluskey said: "This is fantastic news. It secures the future of Vauxhall in Luton and puts to rest any uncertainty over jobs.
"Without a new model Luton would have closed - instead the plant has work until at least 2020 and 1,500 jobs have been secured.
"The efforts of Vauxhall's chairman, Nick Reilly, were pivotal in securing an agreement with Renault and we are extremely grateful for the part he played.
"This decision is also down to the hard work of the workforce and savings they made."
Luton is the last volume manufacturer of commercial vans left in the UK and Unite said it will produce 62,000 units a year.
Renault's Trafic version of the van, currently made in Luton, will switch to its plant in Sandouville, France, from 2013.
Around 1,130 directly-employed staff work at Luton as well as hundreds of contractors, taking the total to 1,500.
Business Secretary Vince Cable said: "This is excellent news.
"Last year I stood in the House of Commons and said that we would be prepared to assist General Motors in its efforts to restructure its European operations, playing our part to put them on a sustainable footing. In the event that help was not needed.
"But our continued close relationship with GM, borne out of that commitment, has paid dividends today, with the announcement that Luton will build the next-generation Vivaro.
"Luton is one of GM's best-performing plants in Europe, with a workforce second to none, and it is absolutely right that those qualities have been recognised today.
"1,500 jobs at the plant and in its supply chain have been preserved, and the plant's future is now assured beyond 2020.
"This is exactly the kind of manufacturing success story that we are keen to promote in the UK and I am proud that we in Government have played our part in that success."Reuse content