Vauxhall owner to close Luton plant

The owner of Vauxhall has announced plans to close its van making factory in Luton, putting about 1,100 jobs at risk.

Stellantis, which also owns brands including Citroen, Peugeot and Fiat, said it would consolidate its electric van production at its other UK plant in Ellesmere Port.

The decision comes after the company warned in June it may halt UK production unless the then government did more to boost demand for electric vehicles (EVs).

There are growing concerns among car manufacturers that rules designed to speed up the transition to electric are too harsh.

As part of the shift to electric, manufacturers are required to sell a certain percentage of cars and vans that emit zero emissions.

Current rules state EVs must make up 22% of a carmaker’s car sales, and 10% of van sales this year. For every sale that pushes it outside the mandate, firms must pay a £15,000 fine.

Car brands with factories in the UK have been urging the government to relax the rules, arguing that EV demand is not strong enough and more incentives are required for drivers to go fully electric.

Following the intense pressure from industry, Business Secretary Jonathan Reynolds is expected to announce a consultation on the rules later on Tuesday.

Stellantis’s Vauxhall Luton plant currently builds petrol and diesel vans and had been due to start making its medium-sized Vivaro Electric van from 2025, before the decision to close it.

Electric models from other Stellantis brands, including Citroën, Peugeot and Fiat, were also set to be built there.