Union leaders will next week hold face-to-face talks with Magna, the new owner of Vauxhall/Opel, as the jobs of hundreds of workers at the company's factories in Britain look increasingly under threat.
A document leaked to a German newspaper indicated that up to 1,200 jobs at Vauxhall's plants at Luton and Ellesmere Port near Liverpool could be cut under Magna's plan for the business.
Although there were no details given about where the cuts would fall, it is thought that Luton, which makes vans, would be worst hit. Such job losses would end production at Luton after 2013.
Britain, along with Belgium and Spain, could lose thousands of jobs if Magna carries out its threat to cut nearly 11,000 workers across the continent. And there is increasing unease among governments and EU officials at how a £4bn loan by Berlin appears to be guaranteeing the survival of German car assembly plants at the expense of other plants.
The union Unite calculates that some 50% of the British workforce would lose their jobs, while only 16% in Germany would go. "The truth of the Magna deal is unravelling before our eyes," said Tony Woodley, joint boss of the Unite union, who will lead the discussions with Magna. "The job losses are the beginning of the end for Vauxhall because that's what they're planning.
"We are demanding an immediate meeting with Magna in order for this deal to be renegotiated so that everyone across Europe feels they're being treated even handedly and fairly."
A contract with Renault to make vans at Luton will guarantee work at the factory until 2013. But Magna will have to decide whether to keep Luton beyond that. In addition it will also have to consider whether to retain Ellesmere Port – home of the Astra. Magna said: "Discussions are ongoing. We intend to honour the contract at Luton and we will look to find an economically viable business plan to keep the plant open beyond 2013."
Lord Mandelson, the business secretary, is co-ordinating the British response to the collapse of GM which earlier this year had to be bailed out by the US taxpayer. He has made clear that £400m of government money is available to help retain Vauxhall car production in the UK. He has been concerned that the GM deal with Magna, underwritten by the German government, should not be a political fix.
The EU is scrutinising the deal very closely to assess whether unfair state aid will lead to the sacrifice of efficient car plants elsewhere in Europe.
A Department for Business spokesman said: "It's too early to quote numbers. We have said that some restructuring is inevitable, but we have had assurances from Magna that Ellesmere Port and Luton will remain open for the foreseeable future."
