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GM RESORTS TO 'DOWN DAYS' AT VAUXHALL PLANT

SHUT: Vauxhall's Ellesmere Port plant

Sunday November 16,2008

By Tracey Boles

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VAUXHALL'S Ellesmere Port plant will be shut all this week as loss-making parent company General Motors desperately seeks ways of saving money.

The Merseyside facility’s 2,200 workers will be retained on full pay for the time being during the “down days”
but concerns are mounting that the cash-strapped carmaker will cut wages next year.

John Fetherston, chief negotiator of union Unite at Ellesmere Port, said: “GM has indicated it cannot continue paying at this level and not produce cars.”

He added tough negotiations lay ahead.

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Earlier this month, GM admitted it might run out of money by the end of the year as sales hit a 25-year low.

The European operations of GM, which between them lost nearly $1billion (£670million) in the third quarter, are being asked to make “major” cost savings in 2009 as the giant Detroit carmaker struggles for survival.

The number of cars produced by GM across Europe is to be drastically reduced in the coming months.

Ellesmere Port — which makes Vauxhall Astra vans and Vauxhall Astra five-door cars — will be operational for only 10 days between now and Christmas when it will also be closed.

GM’s van plant in Luton, which employs 1,700, is also implementing down days.

GM’s unions across Europe will meet again this week to discuss the plans, which include rejigging shift patterns.

It is feared production of new models may be delayed. Ellesmere Port workers are due to produce the new Astra from next September.

Meanwhile, US lawmakers are scrambling to secure a $50billion bail-out for Detroit as the US car capital becomes the latest victim of the credit crunch.

Congress will consider implementing emergency legislation as early as tomorrow but it could be held up by stiff opposition from Republicans.

Industry executives have warned that up to 3million US jobs could be lost unless the Big Three carmakers — GM, Ford and Chrysler — are bailed out with fresh loans.

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Even if the Big Three halved their output, 2.5million jobs would be lost and government coffers would lose $100billion over three years, according to analysts. Gordon Brown said on Friday a bailout would be protectionism and “the road to ruin”.

Tony Woodley, joint general secretary of Unite and a former Vauxhall worker, believes the collapse of GM would be a “catastrophe”, not just for the US and UK economies, but for the global automotive sector as a whole.

He advocates that the UK Government stages its own multi-billion-pound bail-out of the car industry.

In Britain, car sales last month fell by the largest amount for 17 years.