Vauxhall’s parent company, Stellantis, has announced plans to close its van manufacturing plant in Luton next April, putting more than 1,100 jobs at risk.
The decision comes amid mounting pressures from the UK government’s stringent electric vehicle (EV) sales targets, part of the zero-emission vehicle (ZEV) mandate.
Stellantis, which also owns Peugeot, Citroën, and Fiat, intends to consolidate its UK operations by focusing production at its Ellesmere Port facility in Cheshire. The plant has already received a £100 million investment to produce electric vehicles and currently manufactures smaller electric vans such as the Citroën e-Berlingo and the Vauxhall Combo Electric. An additional £50 million investment is planned to boost production capacity at Ellesmere Port.
The closure marks the end of over a century of manufacturing history in Luton, where Vauxhall first established operations in 1905. The Luton plant has been a significant part of the local economy, producing commercial vehicles since 1932 and contributing to the town’s industrial heritage.
Stellantis’s decision follows warnings earlier this year that both its UK plants were at risk due to government pressures to meet ambitious EV sales targets. The ZEV mandate requires car manufacturers to ensure that 22% of their sales are zero-emission vehicles by the end of this year—a target many firms are struggling to meet. Companies face fines of £15,000 for each petrol or diesel car sold beyond the target and £18,000 for each non-compliant van.
Labour’s transport secretary, Louise Haigh, has maintained a firm stance on the targets, despite industry pleas for flexibility. Stellantis had previously considered retooling the Luton plant to produce electric vans exclusively, including the electric version of the Vauxhall Vivaro—the UK’s best-selling electric van. However, this plan appears to have been abandoned in light of the ongoing challenges.
Employees at the Luton plant were informed of the closure, with the company offering relocation packages for those willing to move to Ellesmere Port and support for those seeking new employment. Trade union Unite described the proposal as “a complete slap in the face for our members in Luton,” pledging to support workers and urging the government to intervene.
Rachel Hopkins, Labour MP for Luton South, expressed deep concern over the announcement, highlighting the plant’s significance to the local economy and its role in Luton’s heritage.
Business secretary Jonathan Reynolds acknowledged the difficulty of the situation, stating that the transition to electric vehicles should not come at the expense of jobs. A government spokesperson emphasized ongoing support for the automotive industry, citing over £300 million invested to promote zero-emission vehicles and £2 billion to aid domestic manufacturing transitions.
The Society of Motor Manufacturers and Traders (SMMT) called the announcement “a major concern” for UK automotive manufacturing and urged the government to review the regulations and introduce measures to enhance competitiveness.
Stellantis’s move reflects wider concerns within the automotive sector regarding the ZEV mandate and the push towards electrification. Manufacturers like Ford and Nissan have also voiced apprehensions, with Ford recently announcing 800 job cuts in the UK and Nissan warning of potential irreversible damage to the industry if mandates are not eased.
Car makers argue that stringent targets, combined with a lack of consumer incentives and infrastructure challenges, make it difficult to meet government expectations. The SMMT highlighted that as of October, battery electric vehicles accounted for only 18.1% of the UK’s new car sales, falling short of the mandate’s requirements.
Competition from abroad, particularly from Chinese manufacturers offering budget EVs, adds to the pressure on UK firms. Industry leaders are calling for greater flexibility and support to navigate the transition without jeopardizing jobs and the future of UK automotive manufacturing.
