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Vauxhall sold: Peugeot plays down job cuts and Brexit fears - live updates Vauxhall sold: Peugeot plays down job cuts and Brexit fears - as it happened
(35 minutes later)
6.03pm GMT
18:03
European markets fall
After their recent highs, stock markets are on the back foot at the start of the week, with the banking sector hit by Deutsche Bank’s €8bn cash call and the commodities sector undermined by falling metal prices after key consumer China cut its growth forecasts for this year.
Sentiment was also dented by news of North Korea launching missiles and Donald Trump accusing Barack Obama of tapping his phone during the US election campaign.
But a spate of merger activity - the GM/Peugeot deal and Standard Life linking up with Aberdeen Asset Management - did limit the damage. The final scores showed:
The FTSE 100 finished down 24.14 points or 0.33% to 7350.12
Germany’s Dax dropped 0.57% to 11,958.40
France’s Cac closed 0.46% lower at 4972.19
Italy’s FTSE MIB fell 1.09% to 19,449.85
But Spain’s Ibex ended up 0.06% at 9804.1
In Greece, the Athens market lost 0.96% to 643.50
In the US, the Dow Jones Industrial Average is currently down 55 points or 0.26%.
On that note, it’s time to close for the evening. Thanks for all your comments, and we’ll be back tomorrow.
5.20pm GMT5.20pm GMT
17:2017:20
Here’s more from Greg Clark’s comments on the Vauxhall deal made earlier in parliament, courtesy PA:Here’s more from Greg Clark’s comments on the Vauxhall deal made earlier in parliament, courtesy PA:
Clark said the sale was linked to a wider restructuring of General Motors rather than Brexit.Clark said the sale was linked to a wider restructuring of General Motors rather than Brexit.
When asked whether all automotive companies would get the same deal as Nissan, he added: “We’ve said that by being part of the UK automotive sector, all of the benefits of that in terms of research and development, in terms of trading, in terms of the expansion we see through the industrial strategy of the supply chain, will be available to all such companies.”When asked whether all automotive companies would get the same deal as Nissan, he added: “We’ve said that by being part of the UK automotive sector, all of the benefits of that in terms of research and development, in terms of trading, in terms of the expansion we see through the industrial strategy of the supply chain, will be available to all such companies.”
He added: “The fact that plants are going to be judged, as they tend to be in the automotive sector for new models, on the basis of their competitive efficiency is a strength for us in this country, because our automotive plants are the strongest in the world.”He added: “The fact that plants are going to be judged, as they tend to be in the automotive sector for new models, on the basis of their competitive efficiency is a strength for us in this country, because our automotive plants are the strongest in the world.”
4.36pm GMT4.36pm GMT
16:3616:36
Back with market reaction to the deal. Jasper Lawler, senior market analyst at London Capital Group, said:Back with market reaction to the deal. Jasper Lawler, senior market analyst at London Capital Group, said:
Markets know that when PSA CEO Carlos Tavares talks about synergies, he means job cuts. PSA were likely in the “driver’s seat” in negotiations since after a decade and a half of losses, GM clearly wanted to get shot of Opel and Vauxhall. Through the Opel brands, PSA have a new opportunity for expansion in China, where French car brands have not been so popular.Markets know that when PSA CEO Carlos Tavares talks about synergies, he means job cuts. PSA were likely in the “driver’s seat” in negotiations since after a decade and a half of losses, GM clearly wanted to get shot of Opel and Vauxhall. Through the Opel brands, PSA have a new opportunity for expansion in China, where French car brands have not been so popular.
For the moment, PSA will pay GM for intellectual property, meaning car-buyers can expect to be buying GM standards for the next few years. Eventually Vauxhall will morph into Peugeot so a big question longer term will be how many Vauxhall drivers stay loyal. From a GM shareholder perspective it’s pretty cut and dry; the deal removes a loss-making division from the balance sheet and the proceeds will directly line their pockets via share repurchases.For the moment, PSA will pay GM for intellectual property, meaning car-buyers can expect to be buying GM standards for the next few years. Eventually Vauxhall will morph into Peugeot so a big question longer term will be how many Vauxhall drivers stay loyal. From a GM shareholder perspective it’s pretty cut and dry; the deal removes a loss-making division from the balance sheet and the proceeds will directly line their pockets via share repurchases.
UpdatedUpdated
at 4.40pm GMTat 4.40pm GMT
4.20pm GMT4.20pm GMT
16:2016:20
Jim Cunningham urges caution, warning that the promises made need to be kept as they have not always been in the past.Jim Cunningham urges caution, warning that the promises made need to be kept as they have not always been in the past.
Clark: I am cautiously optimistic. The commitments go in the right direction.Clark: I am cautiously optimistic. The commitments go in the right direction.
We have to do everything we can to make sure [a positive future for the car industry] is achieved.We have to do everything we can to make sure [a positive future for the car industry] is achieved.
And with that the house moves on to the Fox bid for Sky which is being covered in our politics live blog here:And with that the house moves on to the Fox bid for Sky which is being covered in our politics live blog here:
4.09pm GMT4.09pm GMT
16:0916:09
Geoffrey Robinson says the reassurances are very limited in extent and duration, and he refers to the closure of the plant at Ryton, adding that the only reassurance that counts is getting replacement models in the UK and the government should push for this.Geoffrey Robinson says the reassurances are very limited in extent and duration, and he refers to the closure of the plant at Ryton, adding that the only reassurance that counts is getting replacement models in the UK and the government should push for this.
Clark says we do need to stay engaged and make sure these commitments are delivered. It is important these commitments have been given, and in writing. It is a different management now {to the time when Ryton was closed] and the strategy is not based on closing plants.Clark says we do need to stay engaged and make sure these commitments are delivered. It is important these commitments have been given, and in writing. It is a different management now {to the time when Ryton was closed] and the strategy is not based on closing plants.
UpdatedUpdated
at 4.11pm GMTat 4.11pm GMT
4.01pm GMT4.01pm GMT
16:0116:01
Alistair Burt, wants assurances that jobs in the supply chain are secure.Alistair Burt, wants assurances that jobs in the supply chain are secure.
Clark says both the direct workforce and supply chain part of our discussions. [This is] an opportunity to expand the supply chain.Clark says both the direct workforce and supply chain part of our discussions. [This is] an opportunity to expand the supply chain.
4.00pm GMT4.00pm GMT
16:0016:00
Shadow minister Rebecca Long Bailey says workers will be worried about the future of their jobs, and what assurances are there on the Vauxhall plant beyond the existing contracts. Will the production of the new Astra model take place in the UK? With the GM pension deficit, are pensions guaranteed in full?Shadow minister Rebecca Long Bailey says workers will be worried about the future of their jobs, and what assurances are there on the Vauxhall plant beyond the existing contracts. Will the production of the new Astra model take place in the UK? With the GM pension deficit, are pensions guaranteed in full?
The government has little power in takeovers - are there any plans to broaden the definition of public interest in takeovers. What support was offered to PSA following Britain’s exit from the European Union?The government has little power in takeovers - are there any plans to broaden the definition of public interest in takeovers. What support was offered to PSA following Britain’s exit from the European Union?
Greg Clark says these have been worrying times for the workforce. [But] the statements made have been welcomed, not just by me, by trade unions.Greg Clark says these have been worrying times for the workforce. [But] the statements made have been welcomed, not just by me, by trade unions.
The company has said it will honour agreements they have, at least to 2021. Both principal models in UK are early in the cycle.The company has said it will honour agreements they have, at least to 2021. Both principal models in UK are early in the cycle.
On pensions, they have given an absolute commitment no pensioner will be worse off. The pensions regulator is also required to confirm any changes in arrangements.On pensions, they have given an absolute commitment no pensioner will be worse off. The pensions regulator is also required to confirm any changes in arrangements.
As for the takoever regime, this is one overseas company taking over another. But we have agreed with our French and German [counterparts] that we should take a consistent approach.As for the takoever regime, this is one overseas company taking over another. But we have agreed with our French and German [counterparts] that we should take a consistent approach.
As for support available for automotive sector: we hope future owners will take part in support available.As for support available for automotive sector: we hope future owners will take part in support available.
3.55pm GMT3.55pm GMT
15:5515:55
Greg Clark, business, energy and industrial strategy secretary, is answering questions in parliament on the Vauxhall takeover.Greg Clark, business, energy and industrial strategy secretary, is answering questions in parliament on the Vauxhall takeover.
He said the discussions which have taken place can give confidence to the Vauxhall workforce now and for the future.He said the discussions which have taken place can give confidence to the Vauxhall workforce now and for the future.
“We are determined [Vauxhall cars] should continue to be made [here] for many years to come.”“We are determined [Vauxhall cars] should continue to be made [here] for many years to come.”
He said there had been a number of important commitments made: the new owners will honour existing agreements with the workforce; pensioners will be in at least as good a position in future as they are today; the UK division will be treated the same as other parts of the business; they will build on existing agreements and not plant closures.He said there had been a number of important commitments made: the new owners will honour existing agreements with the workforce; pensioners will be in at least as good a position in future as they are today; the UK division will be treated the same as other parts of the business; they will build on existing agreements and not plant closures.
UpdatedUpdated
at 4.24pm GMTat 4.24pm GMT
2.59pm GMT2.59pm GMT
14:5914:59
General Motors shares have opened lower in early US trading following the deal to sell Opel-Vauxhall to Peugeot.General Motors shares have opened lower in early US trading following the deal to sell Opel-Vauxhall to Peugeot.
They are currently down 0.5%, worse than the 0.2% decline on the Dow Jones Industrial Average. The overall market has been hit by a number of new concerns, not least the launch of four missiles by North Korea and Donald Trump’s accusations that his were tapped on the orders of Barack Obama.They are currently down 0.5%, worse than the 0.2% decline on the Dow Jones Industrial Average. The overall market has been hit by a number of new concerns, not least the launch of four missiles by North Korea and Donald Trump’s accusations that his were tapped on the orders of Barack Obama.
UpdatedUpdated
at 3.00pm GMTat 3.00pm GMT
2.53pm GMT2.53pm GMT
14:5314:53
PA also has more comments from Vauxhall workers arriving for work:PA also has more comments from Vauxhall workers arriving for work:
Workers clocking in for their afternoon shift at Luton’s Vauxhall plant reacted with a mix of emotions to news of the company’s sale to French group PSA.Workers clocking in for their afternoon shift at Luton’s Vauxhall plant reacted with a mix of emotions to news of the company’s sale to French group PSA.
Many staff who were yet to start their shift said they only heard about it on the news or online, not from their employer.Many staff who were yet to start their shift said they only heard about it on the news or online, not from their employer.
Paintshop worker Joshua Taylor, 25, expressed uncertainty over job security, saying: “No-one actually knows what’s going on. We haven’t been told if our jobs are safe.Paintshop worker Joshua Taylor, 25, expressed uncertainty over job security, saying: “No-one actually knows what’s going on. We haven’t been told if our jobs are safe.
“I looked over the plants Peugeot bought and it doesn’t look promising.”“I looked over the plants Peugeot bought and it doesn’t look promising.”
James Upton, 26, who has worked at the plant for two years, said: “I’ve had jobs before but this is the one that’s actually stuck.James Upton, 26, who has worked at the plant for two years, said: “I’ve had jobs before but this is the one that’s actually stuck.
“Around here, it’s kind of difficult when you go on the Jobcentre websites and you apply for loads of stuff but nothing ever really comes through, and you think ‘I have to go further afield’.”“Around here, it’s kind of difficult when you go on the Jobcentre websites and you apply for loads of stuff but nothing ever really comes through, and you think ‘I have to go further afield’.”
He said he does not know much about the deal, and described the arrangement by the French car giant as “coming at you fast”.He said he does not know much about the deal, and described the arrangement by the French car giant as “coming at you fast”.
Asked about the mood among his colleagues, he said: “I haven’t gone in there yet to see how everyone’s reacting but I’m sure they’ll be the same as always.Asked about the mood among his colleagues, he said: “I haven’t gone in there yet to see how everyone’s reacting but I’m sure they’ll be the same as always.
“As long as people get paid, they’re happy.”“As long as people get paid, they’re happy.”
Teresa Carway, 63, is retiring at the end of the week after 39 years of service at the Luton plant, and she said the announcement “couldn’t have come at a better time for me”.Teresa Carway, 63, is retiring at the end of the week after 39 years of service at the Luton plant, and she said the announcement “couldn’t have come at a better time for me”.
However she said other colleagues who are coming up to their retirement are concerned.However she said other colleagues who are coming up to their retirement are concerned.
She said: “I think a lot of people are worried because the average age around here is 52 or 53. But if they could get another five, six years out of here, then they can retire.”She said: “I think a lot of people are worried because the average age around here is 52 or 53. But if they could get another five, six years out of here, then they can retire.”
Mrs Carway, who works in the bodyshop assembling bolts on van doors, was hopeful for newer staffMrs Carway, who works in the bodyshop assembling bolts on van doors, was hopeful for newer staff
“(The plant) have taken on loads of new workers,” she said. “They’ve taken on around 300 young workers in the last year.”“(The plant) have taken on loads of new workers,” she said. “They’ve taken on around 300 young workers in the last year.”
2.50pm GMT2.50pm GMT
14:5014:50
No specific assurances given to Peugeot - PM's spokesmanNo specific assurances given to Peugeot - PM's spokesman
More from the prime minister’s spokesman on Vauxhall, courtesy the Press Association:More from the prime minister’s spokesman on Vauxhall, courtesy the Press Association:
Mrs May’s official spokesman insisted that no specific assurances had been given to Peugeot to secure the future of the UK plants.Mrs May’s official spokesman insisted that no specific assurances had been given to Peugeot to secure the future of the UK plants.
The PM had made clear to the company that she wanted the “long history of success” at Vauxhall to continue in this country, said the spokesman.The PM had made clear to the company that she wanted the “long history of success” at Vauxhall to continue in this country, said the spokesman.
But he added: “In terms of specific assurances - none sought, none given.But he added: “In terms of specific assurances - none sought, none given.
“We have a stated position that we will ensure the competitiveness of this country when it comes to the supply chain, research and development and trade.”“We have a stated position that we will ensure the competitiveness of this country when it comes to the supply chain, research and development and trade.”
2.19pm GMT2.19pm GMT
14:1914:19
Summary: Are Vauxhall-Opel jobs really safe?Summary: Are Vauxhall-Opel jobs really safe?
Time for a quick recap, with links to the main points.Time for a quick recap, with links to the main points.
General Motors has denied that job cuts are inevitable after agreeing the sale of its European operations to PSA Group.General Motors has denied that job cuts are inevitable after agreeing the sale of its European operations to PSA Group.
GM is offloading Britain’s Vauxhall and Germany’s Opel to the owner of Peugeot and Citroën, in a €2.2bn deal announced this morning.GM is offloading Britain’s Vauxhall and Germany’s Opel to the owner of Peugeot and Citroën, in a €2.2bn deal announced this morning.
PSA has insisted that staff across its business will get a fair chance to show they can hit productivity targets. CEO Carlos Tavares told reporters in Paris that simply shutting factories down was “rather simplistic”.PSA has insisted that staff across its business will get a fair chance to show they can hit productivity targets. CEO Carlos Tavares told reporters in Paris that simply shutting factories down was “rather simplistic”.
Tavares also pledged to stick to existing deals with Vauxhall workers, and General Motors CEO Mary Barra also claimed that the deal was a win-win for both sides.Tavares also pledged to stick to existing deals with Vauxhall workers, and General Motors CEO Mary Barra also claimed that the deal was a win-win for both sides.
But unions, and individual workers at Vauxhall, are concerned that jobs could be lost - especially if the plants at Ellesmere Port and Luton don’t secure pledges to manufacture new models.But unions, and individual workers at Vauxhall, are concerned that jobs could be lost - especially if the plants at Ellesmere Port and Luton don’t secure pledges to manufacture new models.
Some industry analysts have also predicted job cuts as PSA looks to consolidate its operations.Some industry analysts have also predicted job cuts as PSA looks to consolidate its operations.
The UK government is hopeful that Vauxhall could thrive under PSA’s ownership.The UK government is hopeful that Vauxhall could thrive under PSA’s ownership.
A spokesman for Theresa May told reporters that:A spokesman for Theresa May told reporters that:
The prime minister set out to Ms Barra the importance of the Vauxhall brand to the UK and reiterated her desire for the jobs at both plants to be secured for the long term.The prime minister set out to Ms Barra the importance of the Vauxhall brand to the UK and reiterated her desire for the jobs at both plants to be secured for the long term.
Ms Barra made clear that Vauxhall would remain a British brand and that the deal would recognise and respect all agreements regarding the workforce.Ms Barra made clear that Vauxhall would remain a British brand and that the deal would recognise and respect all agreements regarding the workforce.
Both the prime minister and Ms Barra expressed their confidence that the deal had the potential to strengthen the Vauxhall brand and allow for further growth, supported by the government’s Industrial Strategy and the continued strength of the automotive sector in the UK.Both the prime minister and Ms Barra expressed their confidence that the deal had the potential to strengthen the Vauxhall brand and allow for further growth, supported by the government’s Industrial Strategy and the continued strength of the automotive sector in the UK.
(that’s via our Politics Live blog)(that’s via our Politics Live blog)
Local MPs have also been banging the drum, insisting that Vauxhall plants are already pretty efficient.Local MPs have also been banging the drum, insisting that Vauxhall plants are already pretty efficient.
Labour’s Justin Madders, who represents Ellesmere Port, says:Labour’s Justin Madders, who represents Ellesmere Port, says:
There is no doubt that we have some of the most efficient plants in Europe so we have a good tale to tell and we should not underestimate the positive impact on sales that having a U.K. manufacturing base brings.There is no doubt that we have some of the most efficient plants in Europe so we have a good tale to tell and we should not underestimate the positive impact on sales that having a U.K. manufacturing base brings.
There should be no doubt that one of the biggest selling points to UK consumers is that Vauxhall is a British brand that supports British jobs. That is something that I know will be stressed to PSA.There should be no doubt that one of the biggest selling points to UK consumers is that Vauxhall is a British brand that supports British jobs. That is something that I know will be stressed to PSA.
2.02pm GMT2.02pm GMT
14:0214:02
General Motors was adamant this morning that its European business would have broken even last year, if it wasn’t for the Brexit vote.General Motors was adamant this morning that its European business would have broken even last year, if it wasn’t for the Brexit vote.
As this chart show, that didn’t happen -- although GM has been clawing its way back to profitability since the financial crisis....As this chart show, that didn’t happen -- although GM has been clawing its way back to profitability since the financial crisis....
17 years of GM losses in Europe, all in one chart. Total = $22.5 billion pic.twitter.com/QPkCqnt1mR17 years of GM losses in Europe, all in one chart. Total = $22.5 billion pic.twitter.com/QPkCqnt1mR