Vauxhall owner to decide future of UK factories as net zero row escalates

Stellantis, the parent company of Vauxhall, Fiat, Citroen and Peugeot, is set to decide the fate of its UK plants within weeks amid ongoing rows with the government over electric vehicle sales targets.

In June, Stellantis warned it may need to close its factories in Ellesmere Port and Luton unless ministers reconsider rules requiring a certain proportion of electric vehicle sales. These facilities, which produce electric cars and pickup trucks and employ more than 1,000 workers, remain at risk as the company pushes for changes to the zero-emission vehicle (ZEV) mandate.

The ZEV mandate, introduced this year, requires 22% of cars sold by manufacturers to be electric, a figure set to rise annually until 2030. Companies that fail to meet these targets face fines of £15,000 for each non-compliant car. Or they should trade carbon credits. With competitors.

Carlos Tavares, CEO of Stellantis, warned that current regulations are forcing manufacturers to sell more electric vehicles than consumers demand, leading to significant price cuts to stimulate sales. Tavares highlighted the need for government support to boost consumer demand during a recent Bloomberg interview, noting that a decision on the future of the factories will be made soon.

The challenge for automakers comes as electric vehicle sales grew 25% to a record 56,362 vehicles in September, but that was primarily due to demand from fleet operators rather than private consumers. Despite the deep discounts, private EV sales increased by just 3.7% year-on-year, indicating a need for more incentives to make EVs more attractive to individual buyers.


Jimmy Young

Jamie is an experienced business journalist and senior reporter at Business Matters, with over a decade of experience reporting on UK SME business. Jamie holds a degree in Business Administration and regularly participates in industry conferences and workshops to stay at the forefront of emerging trends. When Jamie is not reporting on the latest business developments, he is passionate about mentoring up-and-coming journalists and entrepreneurs, sharing their wealth of knowledge to inspire the next generation of business leaders.

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