Vauxhall threatens to suspend UK car manufacturing amid dispute over electric vehicle sales targets

The owner of Vauxhall has warned it could stop making cars in the UK amid a row over electric vehicle sales targets.

Stellantis, one of the world’s largest car manufacturers, has threatened to close its plants at Ellesmere Port in Cheshire and Luton over government quotas for zero-emission vehicles. The company employs 2,500 people at the two plants.

In a dramatic escalation of tensions between the manufacturer and ministers, Stellantis UK boss Maria Grazia Davino warned the Government and said the decision would be made in “less than a year”.

He also said Stellantis, which also owns Citroën and Peugeot, could reduce the number of petrol and diesel engines it sells in the UK to meet targets.

Under the government mandate, manufacturers must sell an increasing proportion of electric vehicles each year or face a hefty fine.

The sale of new gasoline and diesel engines will be prohibited from 2035.

Labor has pledged to introduce the ban by 2030 and is likely to face urgent talks with carmakers if it wins the election on July 4, as expected.

Speaking at a motor industry conference in London, Davino said: “We have made huge investments in Ellesmere Port and Luton, with more to come.

“But if this market becomes hostile towards us, we will enter into evaluation to produce elsewhere.”

His comments come after Stellantis CEO Carlos Tavares warned that the automaker would cut sales of gasoline vehicles to avoid violating the new rules.

The company makes electric vans at Ellesmere Port and recently outlined plans to manufacture the vehicles at its Luton plant from next year.

He previously urged ministers to do more to boost consumer demand for zero-emission cars.

The concerns expressed by Stellantis were echoed in a warning from car dealer Vertu Motors that green targets could drive up the price of second-hand petrol and diesel vehicles.

The company, which has 189 sales and aftersales sites, said the so-called zero-emissions mandate, which requires manufacturers to sell a certain percentage of electric vehicles each year, “has the potential to create volatility in the new car market.” “.

He continued: “This may include a reduction in the supply of new petrol and diesel vehicles in the coming periods and would lead to a strengthening of the value of used petrol and diesel vehicles.”