Car-maker Stellantis warns Vauxhall's Ellesmere Port plant at risk unless Brexit deal changed

  • Granada Reports political correspondent Líse McNally sent this live report

One of the world's largest carmakers has said it will be unable to keep their commitment to make electric vehicles in the UK - unless the Brexit deal is renegotiated.

Stellantis - the parent company of Vauxhall, Citroen, Peugeot and Fiat - which employs more than 5,000 people in the UK - told a Commons inquiry into supply of batteries for EV manufacture that their UK investments were in the balance due to the terms of the trade deal.

Electric vans made at Vauxhall's Cheshire site in Ellesmere Port will face tariffs of 10% when exported to mainland Europe from 2024, because they will not contain enough locally sourced parts, the company said. 

  • ITV News Political Correspondent Carl Dinnen reports

The world's fourth biggest car maker committed to making electric vehicles at its Ellesmere Port and Luton plants two years ago.

But in a submission to the inquiry, the company said the Brexit deal was a "threat to our export business and the sustainability of our UK manufacturing operations".

It called on the Government to reach agreement with the EU to maintain existing rules until 2027, rather than next year's planned changes which state 45% of an electric car's value should originate in the UK or EU to qualify for trade without tariffs.

Stellantis said the rise in the cost of raw materials during the pandemic and energy crisis meant it was "unable to meet these rules of origin".

The Astra assembly line at the plant in Cheshire. Credit: PA Images

It said the upcoming rules would see 10% tariffs on trade with the EU and make domestic production and exports uncompetitive with Japan and South Korea.

The company said that would mean manufacturers "will not continue to invest" and will relocate.

"To reinforce the sustainability of our manufacturing plants in the UK, the UK must consider its trading arrangements with Europe," Stellantis told the inquiry, listing Honda's closing of its site in Swindon and investment in the US as examples of its impact.

Stellantis said there will be "insufficient battery production" in the UK or Europe to meet government targets in phasing out petrol and diesel vehicles by 2025 and 2030.

"It we are unable to rely on sufficient UK or European batteries, we will be at a major competitive disadvantage. In particular against Asian imports," they said.

"We need to reinforce the competitiveness of the UK by establishing battery production in the UK."

Mike Hawes, from the Society of Motor Manufacturers and Traders, said: "We're an export led industry. Eighty per cent of what we produce goes abroad.

"To make any free trade deal, you need to meet those rules of origin. Everyone's concerned given the dependence of battery materials from beyond the UK - how are you going to meet them?"

Electric cars and batteries were among the final parts of the Brexit deal agreed between then Prime Minister Boris Johnson and President of the European Commission Ursula von der Leyen in 2020.

A Downing Street spokesman said “we hope to come to a resolution with the EU on this” but would not confirm whether talks were aimed at pushing back the deadline.

“We recognise that for a number of reasons raw material costs for manufacturers have spiked since we signed the TCA,” the spokesman said.

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