Mandelson raises concerns over its takeover of Opel/Vauxhall
8 October 2009

Britain will not accept Magna’s takeover of Vauxhall/Opel unless shortcomings identified in due diligence report are addressed.

A PwC report had identified “shortcomings” in Magna’s plan and the government was not willing to sign off the deal unless these were rectified.

“Those need to be addressed,” said Mandelson. “If there are not to be negative consequences for Vauxhall, the plan needs to be redressed in certain ways.”

The main point of contention in the deal is believed to be the distribution of production among European car plants and the consequent job losses.

Germany is due to supply most of the loan guarantees to fund the Magna deal, but Britain is expected to supply 400 million euro (£368m) in guarantees of its own.

Before signing off the deal, however, Britain wants assurances on the fate of Vauxhall’s two UK plants, in Luton and Ellesmere Port, which employ about 5,000 workers between them.

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8 October 2009

Mandelson is going to give £400m to Magna to secure a few thousand jobs at two plants in UK. Has he seen Vauxhall's sales figures?

Vauxhall van sales down by two-thirds in September 2009, three times worse than overall market decline of 22%. Its sales are down over 50% year to date, compared to 2008.

Vauxhall's car sales are better, compared to its vans sales, but behind the overall market. Down 3% in Sep 2009, against an overall market rise of 11% and down a quarter year to date, compared to down 15% for the overall market.

The point is, the UK car and van buyer has not supported the Vauxhall brand, and ergo, the Vauxhall plants and Vauxhall workers at Ellesmere Port and Luton, especially Luton, since the story of Vauxhall's sale and overall predicament of ownership became cuurent in the British public's consciousness, some six months ago.

Compare the situation in UK, with Vauxhall lagging, van sales crashing, to that in Germany, home market of main brand, Opel. Opel sales were up 35% in Sep 2009, compared to an overall market increase of 21%. Year to date Opel is up one-third on 2008, compared to a quarter for the overall market. Its market share is now 9% and rising of the German car market, putting it ahead of its share(under the Vauxhall brand) in the UK market, of 8% and falling.

The Germans have supported Opel since it suffered through the fallout from parent GM's bankruptcy, by buying more of its cars. The British have not. The van sales in UK are a disaster, suggestive of bankruptcy for Luton. Mandelson and his officials need to consider carefully why it should provide loan guarantees, underwriten by UK taxpayers, to an organisation, for which their is no apparent favour for in UK, as evidenced by declining purchases of its products. If the British car and light commercial vehicle buyer won't back Vauxhall with their cheque books individually why should the UK taxpayer collectively back Vauxhall as a company?

8 October 2009

If i remember, Mandelson said he was going to to arrange a multi million

pound loan for Jaguar.

After,five or six months was it,Jaguar had still not had the loan,it turned out

to be little more than hot air spin and lies.

I think this 'loan' will end up the same!

Also if he cares that much why was he not at the talks with Magna.?

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