General Motors pulls back from European auto market

The Car Expert will update this story as more details emerge.

The agreement will be unveiled at PSA’s Paris head office on the Avenue de la Grand Armée, named after Napoleon’s army.

France’s PSA group acquires Opel, Vauxhall in $3 billion deal.

Its sale of German-based Opel and British-based Vauxhall to PSA Group would create a new regional vehicle giant to challenge market-leader Volkswagen. Ten auto makers sold more than 500,000 vehicles in Europe previous year. General Motors will keep the engineering center in Torino, Italy, which is housing worldwide projects.

The two plants employ 4,500 workers.

Labour MP Gavin Shuker, whose Luton constituency covers Vauxhall’s Luton plant, said: “Glad to see the uncertainty over the PSA/GM deal is now over”.

“The boss of a supply chain consultants company said there was “clearly concern” the Ellesmere Port plant could close, because 75% of Astra components are sourced from the European Union and the vast majority of the vehicles made at Ellesmere Port are sold outside the UK”.

The leader of the Unite union in Britain said in a statement Monday it will focus on trying to persuade the new management that it makes sense to continue “building in Britain”.

Business Secretary Greg Clark, has held talks with executives both at GM and PSA Group. If the deal clears regulators, it is expected to close by the end of the year, the companies said.

Ever since PSA and GM started an active alliance in 2012, there have been suggestions of putting that relationship on a more formal footing, but those ideas were interrupted by PSA’s sudden, and dramatic, financial crisis. Just three years ago his company was on the brink of collapse, leading to a €3bn state-backed bailout in early 2014.

“I am determined that we can convince the new boss, Mr Tavares, that it makes sense for him to continue to build in Britain”.

Holden says Aussie new vehicle buyers and its existing model cycle-plan will not be affected.

Mr Tavares believes that there is a ceiling to the number of people prepared to buy a French vehicle. Executives have said GM doesn’t expect to break even in Europe until 2018. PSA is free to sell future Opel models everywhere in the world.

McCluskey also called on the United Kingdom government to use Wednesday’s budget to make it clear that it will invest in the sector’s future.

Along with other automakers, GM is pouring considerable sums of money into developing technology for self-driving cars.

Last week, chief executive of PSA Group, Carlos Tavares, reassured British unions and the government that production at Vauxhall plants in the United Kingdom will be guaranteed until at least 2021 if a takeover by the Peugeot-maker owner goes ahead. GM has recently shown a willingness to pull out of unprofitable regions, it abandoned Russian Federation in 2015 as that country’s economy fell into recession.