Luton could become centre for PSA group's van growth plans

  • Luton could become centre for PSA group's van growth plans

Luton could become centre for PSA group's van growth plans

PSA-owned Opel and Vauxhall will seek to avoid forced redundancies across their European plants, a turnaround cost-cutting plan announced today.

Furthermore, the company, which is now mainly selling its cars in Europe, announced that it will enter more than 20 new markets. Opel has confirmed its keen interest in joining the fray in Brazil and China.

Vauxhall is launching an electric version of its Corsa hatchback as part of the company's drive to return to profit by 2020.

The Vauxhall/Opel PACE! recovery plan includes strong targets for commercial vehicle growth that could be good news for the Vauxhall van plant in Luton.

From 2024, every Opel and Vauxhall model will be available with a hybrid or fully electric option.

Two PSA auto platforms, destined as the basis for several models, will be quickly introduced at Opel-Vauxhall manufacturing sites, speeding the shift to PSA engines and transmissions.

Earlier this week, the German newspaper Frankfurter Allgemeine Zeitung said Opel would likely begin a hiring freeze and offer early retirement and severance packages to staff, and that a more large-scale retrenchment exercise would probably take place later, if required. Drivetrain families will similarly drop from 10 to four.

From platform sharing to a wider market reach, Peugeot and Opel laid out their plans for 2019 and beyond. PSA Group, the French owner of brands Peugeot and Citroen as well as Opel, is building the Commodore for Australia, although it is tweaked to suit local conditions. There's also talk of a new SUV model in 2019, and a large vehicle at an unspecified time in the future.

The adjustment suggests PSA and Opel may have to do more, faster to achieve the savings that PSA had promised in March, when it agreed to buy Opel from General Motors in a deal valuing the business at 2.2 billion euros.

The companies are hoping to see cost savings of around 1.1 billion euros ($1.7 billion) by 2020, with most of the savings coming through improved purchasing, research and development, and manufacturing costs.

"Opel will go global, finally", Lohscheller said, while cautioning that the plan will also require "reduction of cost in all areas including labor".

"Michael Lohscheller, the Opel-Vauxhall chief executive, has instead opted for technological changes and cutting working hours to reduce production costs by "€700 per car" in three years.