Plans to sell the European arm of General Motors (GM) — including the UK-based Vauxhall and German car maker Opel — to Peugeot owner PSA could be abandoned.
GM’s European division has made a loss every year since 2000, adding up to $20bn.
The deficit in GM’s UK pension scheme, estimated at £1bn ($1.25bn), is one of the key reasons behind PSA’s reluctance to push forward with the deal, according to pensions expert John Ralfe.
The Vauxhall pension scheme had assets of about £1.8bn but liabilities of about £2.6bn, leaving a deficit of £840m, the latest available company accounts to the end of 2014 showed.
PSA would not want to touch the proposed sale “with a barge pole,” Ralfe told BBC Radio 4‘s Today programme this morning.
Vauxhall’s pension scheme is one of the largest in the UK, boasting about 15,000 members.
Politicians from Germany and the UK have pushed for guarantees that PSA, Europe’s second-largest car maker, will protect jobs and plants in their own countries.
Len McCluskey, head of Unite, Britain’s biggest trade union with 1.42m members, is due to meet with PSA chief executive Carlos Tavares on Friday to discuss the French car maker’s proposals.
“I will be using this meeting to press the case for the UK’s world class facilities and workforce, and ensuring that Mr Tavares and the PSA Group understand fully that Luton, Toddington and Ellesmere Port, and thousands of dedicated UK workers, deserve a strong backer and a positive future,” said McCluskey on Saturday.
On Monday, the pending sale will be debated in the House of Commons after speaker John Bercow granted an urgent question on the topic to Justin Madders, the Labour MP for Ellesmere Port and Neston.
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