Deal done to save Vauxhall jobs

Lord Mandelson: "We now have a much better outcome"

The Unite union says it has reached a deal with Magna, the proposed new owners of Vauxhall, to protect jobs at Ellesmere Port and Luton.

Unite said about 600 jobs would go, all through voluntary redundancy. It had been feared that 1,200 of the 5,000 Vauxhall jobs in the UK could be cut.

Magna declined to comment, but Vauxhall said the deal was "very good news".

Business Secretary Lord Mandelson said there was still "some way to go" in agreeing the financing of the deal.

The government wanted to be satisfied about the security of the hundreds of millions of pounds of guarantees it was putting in, he said.

But he added that it was "a much better deal than was offered to us in the first place".

'Team effort'

Unite has agreed to a two-year pay freeze and other cost-savings in return for having no compulsory redundancies.

There was concern about jobs at the two plants after General Motors (GM) decided to sell its European arm.

"This is very good news for Vauxhall's UK operations and is the result of a tremendous team effort between [the] leadership of Unite and the management team at Vauxhall," the company said in a statement.

The deal "gives both plants job security and a future through to 2013, providing a good basis for a long-term future beyond that", said Tony Woodley, joint general secretary of Unite.

And Mr Woodley praised the role Lord Mandelson had played in securing the deal.

"There's absolutely no doubt... that Mr Mandelson's personal, political associations in Europe and elsewhere have changed the dynamics here," he told the BBC.

"Without his personal help we would not have secured the deal that we have got now."

Longer hours

Magna is in the process of buying both Opel and Vauxhall, having been chosen by GM after a long-running bidding process.

Unite's Tony Woodley: "These plants could and should have a long term future"

Magna's co-chief executive Siegfried Wolf had signalled that the Canadian firm could cut as many as 10,500 jobs at Opel and Vauxhall.

It had been feared that about 1,200 of those would go in the UK, but Unite said that only 600 would now be cut and all of those would be through voluntary redundancy.

While Unite has agreed to a pay freeze, its statement added that there would be an increase in working hours to top up workers' earnings.

Under the deal, Ellesmere Port will produce the next generation Astra, set for 2016, subject to maintaining its competitive position.

Meanwhile, talks between Magna and Spanish unions ended without agreement on Tuesday, the unions said.

Magna wants to cut about 1,300 of the 7,000 staff at the Opel factory in the northern Spanish town of Figueruelas, which unions oppose.

"The meeting has finished without any kind of agreement," said Juan Arceiz, head of the workers committee at Opel Spain.