Stellantis said it would shift van production to Ellesmere Port, Cheshire, blaming economic conditions and the government's zero-emission vehicle mandate.
The news was announced on the same day the government said it would consult on changes to the mandate as it tried to head off carmakers' complaints that its electric vehicle sales targets were too high amid slumping demand.
Stellantis's decision is a bitter blow to the UK car industry, as carmakers around the world struggle with low demand and intense competition while also investing in electric vehicle production. Ford last week said it would cut 4,000 jobs in Europe, including 800 in the UK, while Volkswagen is to close three factories in Germany, the first time it has closed plants in the country.
The Stellantis factory in Luton employs 1,100 people. Stellantis said several hundred workers could be moved to Ellesmere Port, which would receive a £50m investment.
Workers at Luton were informed of the decision yesterday. Less than a year ago, Stellantis said the Luton site would produce medium-sized Vivaro electric vans for the Vauxhall, Citroën, Peugeot and Fiat Professional brands. Ellesmere Port produces smaller electric vans after a £100m investment announced in 2021.
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