Carlos Tavares says Vauxhall’s British heritage presents an opportunity - but again warns of no-deal Brexit risks

PSA Group boss Carlos Tavares has reiterated his belief that Vauxhall could be “the only survivors” of the British car industry following Brexit.

 

The threat of a no-deal Brexit has been a major concern for car firms, due to the potential impact it could have on supply chains. Both Toyota and BMW suggested during the Geneva motor show that they could shift production out of the UK.

Tavares has previously warned that Brexit could potentially lead to the closure of Vauxhall’s Ellesmere Port plant. But speaking at Geneva, he emphasised that Vauxhall’s British heritage could be an advantage, and might leave its Ellesmere Port and Luton plant as the only remaining volume vehicle factories in the UK.

“We are ready for both scenarios,” said Tavares, adding: “no deal is not acceptable.”

He continued: “We love to make cars in the UK. But can we do it without penalising other [PSA Group] employees? If the politicians do not come up with a deal, we are introuble. But Vauxhall is doing the right things. We will decide after Brexit.” 

Tavares first suggested that Brexit could be an 'opportunity' for Vauxhall during a press conference on PSA’s 2018 results, when it was announced Vauxhall-Opel had posted a profit for the first time in 20 years

He admitted that Brexit presented a “headache” in terms of supply chain and that the firm was already positioning inventory to try and cope with such a scenario – but added his belief that Vauxhall could be positioned to benefit.

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“One direction is to say it is going to be a headache in terms of supply chain,” said Tavares. “We have been taking some decisions on that matter and moving inventories to where they should be if that time-lag is going to appear. 

“We can go on the dark side and say ‘perhaps we have to shut down plants’, and if we have to make difficult decisions we will. But on the other side, let’s not forget that we have the Vauxhall brand, which is warm to the hearts of UK consumers. Having a British brand like Vauxhall is a significant asset, and something that is unique to PSA.

“We may have almost the opposite opportunity, which is to be the survivor of the automotive industry in the UK. We may be the ones who have the best opportunity to survive and make a business out of it.”

Tavares added that Vauxhall had actually grown in the UK since the vote to leave the European Union. “Since Brexit was announced the overall profitability of the passenger car business in the UK has doubled, our market share has improved and our customer satisfaction index has improved,” he said.

“That is very surprising, because since we announced Brexit we have all spent our time saying ‘it’s going to be a nightmare, it’s going to be difficult, blah, blah blah,’ and sterling has lost significant value – and and all of this is true. But the reality is that we have adapted our sales channel mixes, we corrected our pricing, we made cost reductions, we tried to be more thoughtful in the way we do business, and since Brexit was announced our profitability in the UK doubled.

“That means there is no limit to the talent of people. I am not facing Brexit always on the dark side of this outcome: there may be for the Vauxhall brand an opportunity for us. We are managing our marketing communications in the UK in a way that is very supportive of a British brand in the UK.

“We prepare for the two outcomes and will deal with them when it comes up. Most probably there’s going to be a delay, which gives us a little more visibility for 2019.”

Read more

Porsche warns of 10% price rise after no-deal Brexit

UK car industry: no-deal Brexit could have 'devastating impact'​

Vauxhall to cut hundreds of jobs at Ellesmere Port in 2019​

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Comments
15

26 February 2019
The idea of a Growth Mindset is really fashionable in business these days, and PSA have clearly caught the bug. I hope its more than just talk though. It'd be great to see Vauxhall thrive now it's free if GM

26 February 2019

OK it's only a minor story but in these continous negative news (really opinions and predictions)  days it must be a nice read if you work at Ellesmere.

typos1 - Just can’t respect opinion

26 February 2019

Oh the joys of Brexit Britain, where everyone will drive a Vauxhall. Has anyone told the car-buying public yet?

MrJ

26 February 2019

I've had two V/O Astra estates over the last few years.

Both were reliable, economical, and good haulers.

So yes, I think Brits could go for a revitalised brand with more oomph than in times past. 

26 February 2019
scrap wrote:

Oh the joys of Brexit Britain, where everyone will drive a Vauxhall. Has anyone told the car-buying public yet?

 

Don't worry. It's definitely good enough for you.

6 March 2019

Hey, whats wrong with Vauxhalls?

Be good to see them grow really big.

I mentioned Brexit being the blame for car manufacturers moving out and I nearly got my head bit off.

True, some people blame brexit for everything but the opposite extreme exists as well.

JMax

26 February 2019

NOT ELLESMERE!! Ellesmere is a Shropshire town, Ellesmere PORT sits on the banks of the Mersey. It is known as "The Port" and not ELLESMERE for short. Please do not abreviate without local knowledge. :) :)

 

26 February 2019

not only geograhical - THAT's the ticket. There is WAY more to 'auto-mobility' than having sheet metal boxes on wheels roll off the production line.

26 February 2019

Maybe Tavares thinks after Swindon goes all those die hard Honda fans at the bowls club will return to buying "French" made Vauxhalls! After shutting Ryton PSA market share fell. Now that they have a "British" brand they think they can gain market share with Vauxhall. The biggest problem for PSA is that they have got 2 factories building the Astra, one in Poland & the other at Ellesmere Port. It doesn't take a degree in economics to work out that with the decreasing market share of the Astra they only need one factory to build it in. So one of those has got to close................Or maybe PSA will do a deal with the British Government & get a uge grant to build electric Vauxhalls in the UK?

26 February 2019

This kind of makes sense. I guess the thinking is that if the UK diverges from the EU rules and regs then having a factory in the UK to support a volume business still in the UK makes sense. This would never work for the likes of Honda because their market share in the UK is much smaller. The problem is it may only work for Vauxhall. Even JLR don’t have enough UK only volume to support this model....

So looks like we will all have to own Vauxhall’s in Brexit Britain. Oh dear....

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