30th May 2006

Now, during the first half of 2006, his corporation has had to choose between axing nearly 1,000 British Vauxhall workers or a similar number of German Opel employees... and it's the Brits rather than the Germans who've been dumped. How come these Ellesmere Port jobs are the ones to be sacrificed? Especially after Lutz told me that the UK has the edge over Germany as a manufacturing country.

"Germany is tougher than Britain. Without a doubt Britain is a better place to make things," he insisted when we spoke in Los Angeles.

"Germany has been used to success in the last 40-50 years or so and is having a problem dealing with the new reality. Britain is now the sort of country that's gotten its act together.
It's nicely attuned to the realities of the world after losing its indigenous motor industry." Not that any of the above can be consolation for Vauxhall, Ellesmere Port and its hundreds of sacked workers.

In other parts of the world, we've already seen GM kill off its small brands which mean something locally, but next to nothing on the international stage. With that in mind, I directly asked Lutz if he still needed the comparatively tiny Vauxhall marque, which carries little weight outside its native Britain? "Well, we do and we don't. If you could wave the magic wand and bring it all under one brand - let's say Opel - without a short-term dramatic decrease in sales, I think we'd do it, because it makes all the sense in the world."

But thankfully he says that all things considered, he sees no reason to dump the Vauxhall badge. At least not "for the time being", thereby giving himself a clever get-out clause to change his mind at any time in the future! He also admits the value of the Vauxhall brand in the UK is not as good as he'd like it to be, and not as strong as it was 15-20 years ago. And in a further chilling warning to GM's western car factories, the vice president of global product development had this to say.

"It's clear that both in the US and Europe we're under dramatic pressure from the Asians... whether it's the South Koreans, Japanese or, one step removed, the Chinese. And ultimately it's those economic forces that close your plants for you. Nowadays you cannot guarantee anybody's job in a western industrialised company. The competition is so tough. There is no guarantee for anybody." Lutz is one of the straightest-talking senior executives in the global car industry. But the fact is that since my exclusive interview with him a few months ago, his corporation has incurred and formally announced an eye-watering .6 billion annual loss.

Talk of industrial action at Ellesmere Port will play into GM's hands, as a cash-strapped corporation can justify closing a plant whose employees choose to sabotage production and sales. The suggestion by part of the union movement that new Vauxhalls should now be boycotted is equally suicidal. "Too little, too late," were the words I muttered to myself as Chancellor Gordon Brown and former Transport Secretary Alistair Darling put in pathetic appearances at Ellesmere Port after nearly 1,000 jobs were axed. I hope I'm wrong, but I reckon the best long-term hope for the workers left there is to accept that the Vauxhall brand will eventually die and that their future rests in building GM's Opel products, and perhaps a few Chevrolets, too.

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