British Vauxhall factories at risk of closure under PSA

Jim Holder, writing for Autocar:

“If a plant closure is the favoured option, it is likely the axe will be brought down on Ellesmere Port. PSA has already highlighted deficiencies at the Cheshire facility, while Vauxhall's Luton factory had its fate secured for ten years back in April due to demand for capacity to build the Vivaro van. 

Previously, PSA Group CEO Carlos Tavarez stated that the Ellesmere Port plant must close the cost and quality gap between it and its European equivalents if it's to survive.”

This news continues as a flow-on effect following Groupe PSA’s 2017 acquisition of Opel and Vauxhall. The Ellesmere Port factory solely builds the Vauxhall Astra in right hand drive (RHD) for the UK, a car which for Australia, is built at PSA’s factory in Poland. Ultimately, the closure of this factory would not be unexpected - it’s already surprising that an identical model needs to be built in two separate locations despite only the UK and Australia being key markets for the RHD Astra. Surely savings would be realised by shifting production of UK models to the same Polish factory where Australian vehicles are currently sourced from.

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Above: Vauxhall Astra, sold in Australia as the Holden Astra

Holden Test Drive Challenge

Holden has launched a new 'Test Drive Challenge' where the customer receives a $500 prepaid Visa card if they test drive a Holden, but end up purchasing a competitor vehicle. Here's why I think such a scheme is flawed:

  • The key tagline behind this 'Test Drive Challenge' is that Holden engineers have ensured their cars 'perform just like a Holden should.' The problem with this is that Holden's portfolio over the last 20 years has been a cacophony of products sourced from all over the global GM empire. For example, Holden's small car offering has ranged from the Opel (GM's former European arm) sourced Astra, to the Daewoo (GM Korea) sourced Viva, then the originally Korean (and later 'Australianised') Cruze, and now back to the European Astra hatch and North American sourced Astra sedan. Although Holden has recently developed a tuning program to adapt imported vehicles to Australian conditions, these vehicles have fundamentally been developed for different markets, with different driving tastes, and thus do not share 'family-wide' driving characteristics in the same vein that vehicles from Mazda, or even BMW, do.    
  • The campaign in general simply reeks of a desperate attempt to move dealership stock as quickly as possible. Rather then sell cars on their inherent quality, this campaign paves the way for dealerships to convince customers to go for a test drive, and then try to sell the vehicle through heavy discounting, to the extent the customer would be silly to buy a competitor car, even with a $500 benefit. Moreover, such heavy discounting has a detrimental flow-on effect to the residual value of Holden vehicles.