The latest (good and bad) news on Vauxhall
Brexit might tip the balance, says new boss
AMID THE swirling uncertainty over what’s going to happen to the Vauxhall factories of Ellesmere Port and Luton under PSA Peugeot-Citroën ownership, we have pinned down one piece of good news for those who cherish the Vauxhall brand: PSA boss Carlos Tavares won’t ditch it in favour of Opel.
‘Why would I do that? I don’t think that makes any sense,’ he told CAR at the Frankfurt show in September. ‘I think it’s exactly the opposite. We should leverage the power of the Vauxhall brand.’
Tavares is preparing a plan for Vauxhall/Opel, to be revealed in November, and wouldn’t be drawn on how exactly he’ll fold the loss-making brand into PSA. But he’s been vocal on the need to cut costs, leading some analysts to predict Vauxhall could be dumped in favour of Opel in the UK, not least because the brand’s image lags so badly among car buyers.
Tavares believes the Vauxhall brand still carries clout in the UK. ‘I see the market share, that’s the only indicator I have,’ he said, adding: ‘From a pure business perspective I see no reason not to surf on the history of Vauxhall. It’s a fantastic history.’
He’s right about that. Vauxhall started building cars in 1903, and quickly gained a reputation as a maker of fast, stylish machines. That was continued with modern classics such as the Firenza HP ‘Droopsnoot’, Lotus Carlton and Astra GTE.
What’s less convincing is Tavares’s emphasis on market share as an indicator of brand power. Vauxhall will almost certainly lose its long-held No2 position behind Ford to Volkswagen this year as sales slide. In the eight months to the end of August, they fell 19 per cent as Vauxhall struggled to replace loss-making fleet sales with profitable private sales.
Vauxhall’s two British plants build the Astra and Vivaro van. What happens to those, according to Tavares, will be dictated by two things: their competitiveness with the PSA factory network, and the terms agreed for Britain’s exit from the European Union in March 2019. Tavares has asked his team to draw up two scenarios by Christmas for ‘a closed market or open market’, he said. Essentially, hard Brexit or soft. This will affect his decision on ‘investments, product allocations, manufacturing changes, processes’ – essentially whether Ellesmere gets the new Astra come 2021 and what happens to the Vivaro.
Tavares will visit Ellesmere Port ‘in a few weeks’ to perform the same cost and efficiency comparison as PSA has done on two Opel plants: Zaragoza in Spain and the Russelsheim plant in Germany. He wasn’t impressed. ‘From what I have seen PSA plants are more productive and more efficient than the Opel sites. The gaps are significantly big,’ he told journalists at Frankfurt. So while the Vauxhall brand looks to be safe, we might yet lose UK production.
Vauxhall will almost certainly lose its No2 UK sales ranking