Economy

Electric Corsa leads Vauxhall/Opel revival plan under PSA

PSA aims to keep all current Vauxhall and Opel plants open, including Luton and Ellesmere Port.

Rapid product launches will complete the transition to the PSA architectures by 2024, three years ahead of the previous timetable, Opel said, as it outlined turnaround plans that leave a 1.7 billion euro (£1.5 billion) synergies goal unchanged. This will allow Vauxhall to use engines and gearboxes already used in Peugeot, Citroen and DS products. All models will switch to existing PSA platforms faster than originally expected too.

Despite the faster pace, however, PSA maintained both the 1.7 billion euro synergies goal and its 2026 deadline, with 1.1 billion or roughly two-thirds of that amount due by 2021.

Adopting PSA equipment should also help Opel comply with new EU-wide carbon emissions regulations, an area where it has been seen as lagging.

"Having full access to Groupe PSA technologies, Opel/Vauxhall will become a European CO2 leader", the company said in its statement. Shared platforms, electrification and expanding Vauxhall/Opel's reach is all part of the plan leading to profit by 2020.

From 2024 onwards, all Opel and Vauxhall passenger auto models will be based on joint group "architectures", Opel boss Michael Lohscheller said. All models will offer electric or plug-in hybrid versions by 2024.

By 2024, all new Vauxhalls will sit on just two PSA platforms - CMP for smaller vehicles like the upcoming Corsa, and EMP-2 for its larger vehicles. To return to profitability, Opel plans to reduce its break-even point-the number of cars sold at which it starts making a profit-to 800,000 vehicles. Opel-Vauxhall sold around 1.16 million vehicles a year ago.

LCV growth is also expected under the plan, which could mean good news for Luton.

The PACE! plan has been created to maintain all of the firm's factories and avoid forced redundancies in Europe.

Industry expert Ferdinand Dudenhoeffer, director of Germany's vehicle research centre, estimates that Opel-Vauxhall's reorganisation could see it shed some 6,000 jobs to help it "catch up to PSA in terms of productivity".

Peugeot parent PSA Group said on November 9 that its technology will be used in all Opel-Vauxhall models sooner than initially planned to deliver promised savings from its acquisition of the loss-making German carmaker. (GM) earlier this year.

The sweeping changes looming at Opel carry echoes of the tough-love approach PSA chief Carlos Tavares employed when he took the helm at PSA in 2014, bringing it back from the brink of bankruptcy by slashing staff, freezing salaries and cutting per-unit costs.



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