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Birmingham Post
Birmingham Post
Business
Jon Robinson

Vauxhall Ellesmere Port owner Stellantis warns of job cuts over electric vehicle costs

The owner of Vauxhall's Ellesmere Port factory has warned external pressure on car makers to speed up the shift to electric vehicles could potentially threaten jobs and vehicle quality because of higher costs.

Stellantis NV chief executive Carlos Tavares added the costs to accelerate the transition to electric vehicles are "beyond the limits" of what the auto industry can sustain.

Mr Tavares's comments were made in an interview at the Reuters Next conference.

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He said: "What has been decided is to impose on the automotive industry electrification that brings 50% additional costs against a conventional vehicle.

"There is no way we can transfer 50% of additional costs to the final consumer because most parts of the middle class will not be able to pay."

His comments come after Stellantis confirmed in July a £100m investment into its Ellesmere Port plant, securing hundreds of jobs at the huge site.

Around 800 people are directly employed by the Vauxhall plant, known for manufacturing the Astra model.

Mr Tavares added that car makers could charge higher prices and sell fewer cars, or accept lower profit margins but that those paths both lead to cutbacks.

He also said automakers need time for testing and ensuring that new technology will work, adding that pushing to speed that process up "is just going to be counter productive. It will lead to quality problems. It will lead to all sorts of problems".

Mr Tavares did say that Stellantis is aiming to avoid cuts by boosting productivity at a pace far faster than industry norm.

"Over the next five years we have to digest 10% productivity a year ... in an industry which is used to delivering 2 to 3% productivity" improvement, he said.

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