The owner of Vauxhall has announced plans to close its van making factory in Luton, putting about 1,100 jobs at risk.
Stellantis, which also owns brands including Citroen, Peugeot and Fiat, said it would consolidate its electric van production at its other UK plant in Ellesmere Port.
The company said the decision had been made in the “context” of the UK’s rules designed to speed up the transition to electric vehicles (EV).
There are growing concerns among car manufacturers over EV sales targets, with many, including Stellantis, calling for the government to do more to boost consumer demand.
As part of the shift to electric, manufacturers are required to sell a certain percentage of cars and vans that emit zero emissions.
Current rules state EVs must make up 22% of a carmaker’s car sales, and 10% of van sales this year. For every sale that pushes it outside the mandate, firms must pay a £15,000 fine.
Car brands with factories in the UK have been urging the government to relax the rules, arguing that EV demand is not strong enough and more incentives are required for drivers to go fully electric.
Following the intense pressure from industry, Business Secretary Jonathan Reynolds is expected to announce a consultation on the rules later on Tuesday.
Stellantis’s Vauxhall Luton plant currently builds petrol and diesel vans and had been due to start making its medium-sized Vivaro Electric van from 2025, before the decision to close it.
Electric models from other Stellantis brands, including Citroën, Peugeot and Fiat, were also set to be built there.
Now, the electric model that had been scheduled for manufacturing at Luton will move to Ellesmere Port, which is to get a £50m cash injection.
Production of Stellantis’s conventional vans will be transferred to France
The company said the closure of Luton in spring next year would “potentially contribute to greater production efficiency”.
It said said hundreds of permanent jobs would be created at Ellesmere Port and that it would provide relocation assistance to workers who wanted to transfer from Luton.
