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Thousands of jobs at risk as Astra factory faces closure

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Lucy Harley-McKeown
·2-min read
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A row Vauxhall Astra cars stand outside the Vauxhall plant at Ellesmere Port near Liverpool, northern England on May 16, 2006. Vauxhall's parent company, General Motors, is expected to announce cutbacks to the workforce at the Ellesmere Port plant.  REUTERS/Phil Noble
A row Vauxhall Astra cars stand outside the Vauxhall plant at Ellesmere Port near Liverpool, northern England on May 16, 2006. Photo: Reuters/Phil Noble

Thousands of jobs could be at risk, as Vauxhall has said it will stop producing its Astra model at Ellesmere Port in Cheshire and close the plant completely in April next year unless it gets government support. 

The factory employs almost 1,000 people on site and supports 6,000 jobs in its supply chain. 

Vauxhall's parent company is seeking incentives from the UK government in order to keep the plant and the jobs in place. 

A briefing document, which was cited by The Telegraph was circulated by parent company PSA Group (which merged with Fiat Chrysler in January to become Stellantis (STLA)), includes an "end of life" plan for the current model of the Astra and a forecast for "European main events."

Other versions of Astra are built in Gliwice, Poland, and are expected to stop production at the end of 2021. 

Stellantis said back in March that it was in talks with the UK government over whether it will develop its new Astra model at the plant.

The firm asked for government support to keep the plant open. The company was also reportedly seeking incentives to make fully electric cars.

Business secretary Kwasi Kwarteng has previously said that he is "absolutely committed" to securing the future of car manufacturing at Ellesmere Port.

Kwarteng has said he has held and will continue to hold talks with Stellantis, including with subsidiary Vauxhall, which runs the plant, and unions such as Unite.

READ MORE: UK government to dilute rules on overseas takeovers

The UK government is moving forward with plans to ban the sale of new cars with combustion engines from 2030, in a move that it hopes will bring it closer to net-zero goals. The ban would make production of petrol and diesel models in the current Astra plant uneconomical. 

This scuppered plans unveiled last month by Stellantis CEO Carlos Tavares to build a new car at the plant. 

Tavares said in February that governments can “create situations which destroy the business model,” telling a press conference: “If we are told that in 2030 internal combustion engines cannot be sold in the UK – which we respect as a decision from the country – then we are not going to invest in internal combustion engines anymore because that makes no sense.”

Yahoo Finance contacted Stellantis for comment. 

A government Spokesperson said: “We are committed to ensuring the UK continues to be one of the best locations in the world for automotive manufacturing, and we’re doing all we can to protect and create jobs, while securing a competitive future for the sector.”

Watch: Can the UK be rid of petrol and diesel cars by 2030?