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UK Politics

Mandelson plea to regulators over Vauxhall plants

Business Secretary Lord Mandelson today urged European regulators to ensure that the future of the UK's Vauxhall plants was not placed at risk as a result of a "political fix".

The sale of General Motors' European operations to car parts giant Magna, backed by the Russian Sberbank, has left the Vauxhall workforce concerned that the Ellesmere Port and Luton plants will close.

The deal follows intense lobbying and a package of financial support from the government in Germany, where GM's Opel arm is a major manufacturer.

Lord Mandelson told the BBC Radio 4 Today programme: "I think this is going to trigger quite a debate and quite an examination by the European Commission."

He said: "European governments and the commission will want to drill down into the business plans and the financial contributions by the various governments to see that European state aid rules in this Magna-GM deal are being respected."

Union officials fear the sale will save more jobs in Germany than in other European countries where GM has factories.

Vauxhall employs 5,500 people in the UK at its plants in Ellesmere Port and Luton.

Lord Mandelson said: "The commission should not accept anything that looks like a political fix or any linkage between aid and retention of jobs in any specific plant or country.

"Our Vauxhall plants at Ellesmere Port and Luton are highly efficient and I am sure, and insist, that this be recognised.

"So there will be some tough, detailed negotiations that lie ahead and it is important that the European Commission takes a role and a hand in these negotiations."

When the deal was announced last week, German Chancellor Angela Merkel told a news conference in Berlin that the move was the outcome her government had been working towards as it fought to preserve the firm's 25,000 jobs and four plants in Germany.