Longer Hours And Pay Cuts For UK’s Magna Workforce


AFTER weeks of extensive negotiations, an agreement on the future of the UK Vauxhall plants has been reached between Unite, the biggest UK union in car and components manufacturing, and Magna, the Canadian auto parts company and preferred bidder for General Motors’ European operations.

Unite described the agreement as a fairer deal for the UK, giving the plants at Ellesmere Port and Luton improved prospects for the future.

Tony Woodley, joint general secretary of Unite, said: ‘This agreement removes the uncertainty surrounding our plants and our people’s jobs.

‘It gives both plants job security and a future through to 2013, providing a good basis for a long-term future beyond that.

‘Production at Ellesmere Port will grow significantly from the level originally proposed to nearly 148,000 units, with full capacity over two shifts, and there is agreement that Luton will remain a key manufacturing site.

‘Some 600 jobs that would otherwise have been lost will be preserved, but equally as important, Magna has agreed to no enforced redundancies.

‘Agreement has now been reached with the workforce in this country.

‘We would urge that each and every government involved in the European operations, including that in the UK, now wastes no time in finalising the financial contribution which they will make to this business.’

Derek Simpson, joint general secretary of Unite, added: ‘When we started off this process, we made it clear that we were seeking a fairer arrangement for the UK plants, and that is what has been achieved.

‘The UK government, chiefly the Prime Minister and Lord Mandelson, has been pivotal to reaching agreement today.

‘Their support has ensured we can preserve and maintain the 25,000 jobs in manufacturing and services and the 403 components companies which depend on Vauxhall, and would have been at serious risk had agreement not been reached.

‘This is testimony to the success of the government’s approach, which is not to stand idle and let the market prevail but to intervene to protect the best in British industry.

‘Unite thanks them for their work because through their efforts they have made sure that our plants can have a future.’

The agreement struck between Unite and Magna states that:

• Ellesmere Port, subject to maintaining its competitive position, will produce the next generation Astra (set for 2016);

• the Luton van plant will be maintained as a key site within Magna’s UK portfolio, and confirms that Magna will seek ‘any other possibility on product’ for the plant;

• there will be no compulsory redundancies at either UK plant;

• two shifts at Ellesmere Port with volume agreed at 147,500 by 2011 irrespective of demand fluctuations.

In return, the workforce will contribute through cost-saving and efficiency measures, including a two year pay freeze (although weekly working hours will rise helping to bridge the earnings gap) and increased contributions to the car purchase scheme of £20 per month.

Talks between Magna and the works councils of the other European nations continue.