Stellantis to close Luton plant in the UK

Car manufacturing group Stellantis plans to close its plant in Luton, north of London in the UK. Company sources said that it wants to concentrate the entire production of electric light commercial vehicles (LCVs) in the Ellesmere Port site in Cheshire.

The Italian-French-American carmaker explained that the aim is to create a new hub to strengthen the activity of fully electric commercial vehicles in the United Kingdom. In Luton, 1,100 workers are involved, and a consultation round has been launched with workers and unions.

Some of them could be transferred to Ellesmere Port (300 km more north), “where Stellantis will create hundreds of new permanent jobs” and invest some £50 million.

Stellantis also said it would offer job support, including opportunities for retraining, to all those impacted and will work with local government and employers to find new work for Luton-based employees.

Government concerned

A government spokesman said: “While it’s encouraging to see Stellantis investing in the future of its Ellesmere Port plant, we know this will be a concerning time for the families of employees at Luton who may be affected.”

“We have a longstanding partnership with Stellantis and will continue to work closely with them, as well as trade unions and local partners, on the next steps of their proposals,” he added.

Stellantis plans to operate the consolidated production line at Ellesmere Port by the second half of 2026.
The Ellesmere Port factory makes battery-electric light commercial vehicles, including Vauxhall, Citroen, Peugeot, and Fiat.

The carmaker said the plans could help make its production more efficient, given the Government’s zero-emission vehicle mandate. This requires 22% of all new car sales to be battery-electric vehicles in 2024, with the target rising to 80% by 2030 and 100% by 2035.

The government’s spokesman also mentioned: “The Government is also backing the wider industry with over £300 million to drive uptake of zero-emission vehicles and £2 billion to support the transition of domestic manufacturing.”

Other reactions

The Society of Motor Manufacturers and Traders (SMMT) has warned that the current transition to electric vehicles could have a “devastating impact” on the automotive industry. The trade association said the market has failed to keep pace with the targets set out in the Government’s zero-emission vehicle mandate.

In a new analysis, SMMT found that weak demand for electric vehicles (EVs) combined with “the need to fulfill ever-rising sales quotas” will cost the industry some £6 billion this year and called for “urgent market intervention”.

SMMT continued: “Since the mandate was designed more than two years ago, the original assumptions on which it was founded have not yet been borne out. Market demand has failed to meet ambition, steep interest rates, raw material and energy prices remain high, and geopolitical tensions and economic uncertainty impact global confidence. The UK is not immune to global pressures with costs stubbornly high and a lack of confidence in perceived charge-point provision resulting in a reluctant market.”

SMMT CEO Mike Hawes said: “We need an urgent review of the automotive market and the regulation intended to drive it. Not because we want to water down commitments, but because delivery matters more than notional targets.”

“The industry is hurting; profitability and viability are in jeopardy, and jobs are on the line. When the world changes, so must we. Backed with incentives, workable regulation will set us up for success and green growth over the next decade, he concluded.

The unions’ reactions are also clear. A spokesperson of Unite, a leading union in the UK and Ireland, reacted: “The proposal that has been tabled today has been a complete slap in the face for our members in Luton, where Vauxhall vehicles have been manufactured for 120 years. Whatever the positive benefits this plan may have for Ellesmere Port, that is unacceptable.”

He added, “We stand ready to support our members in doing whatever we can to ensure that historical vehicle manufacturing is maintained in Luton, and we call on the government to do the same.”