After PSA Group who own Vauxhall confirmed plans to merge with Fiat Chrysler concerns have grown over the future of Vauxhall plants in the UK.
Should the merger happen there will be significant cost saving measures that could place uncertainty over Vauxhall’s Luton and Ellesmere Port plants future.
However, PSA Group has said there will be no factory closures as they expect to reduce costs by €3.7bn.
Professor David Bailey of Birmingham Business School said plants do remain under threat but may not close immediately.
Professor Bailey told the PA news agency, “Luton and Ellesmere Port are both very efficient plants. They’ve competed to win contracts very successfully despite the Brexit uncertainty.
“But I think given the merger of these two giants, there will be pressure to take capacity out, and British plants will be vulnerable.”
The French government who are a shareholder of Peugeot owner PSA Group will want to keep jobs in France whilst the Italian government will want to keep their Fiat factories in Italy.
The 50 – 50 partnership will create a market value of around $50bn and the combined Fiat Chrysler – PSA Group will produce 8.7m cars a year.