Groupe PSA announce some positive news regarding UK Vauxhall production of commercial vehicles at its Luton plant. The plant is expanding, the new Vauxhall Vivaro is coming – plus other brands too…

The new French owner of Vauxhall has announced it will increase production at the company’s vans factory in Luton despite concerns over the impact of looming Brexit.

PSA, which owns Peugeot and Citroen and bought Vauxhall from General Motors last year, said the UK plant will increase production to 100,000 vans a year from 2019 – up from the current 59,000.

The next model of Vivaro van will still be built in Luton, and so will the new Peugeot and Citroen models. The move is expected to safeguard all of the 14,000 jobs at the UK factory, which is Britain’s only remaining van factory, and to create new roles.

However, the news comes as PSA announced only a couple of weeks ago that it would trim back almost a third of Vauxhalls dealer network. However, with walk in showroom traffic fading away from all brand dealers, is this such a bad thing?

PSA wants to cut almost £1billion of expenditure from the Opel and Vauxhall business by 2020, and £1.5billion by 2026 without having to resort to closing manufacturing plants in the country.

Parent company Groupe PSA declined to say how much it will invest in Luton’s plant but described it as “substantial”. Taxpayers will put in £9million as part of the Government’s subsidy of the automotive industry.

The Government has estimated the total investment will be around £100million, while Union Unite said the investment was £170million, adding it would create 450 jobs. Carlos Tavares, chairman of PSA, said: this was a “major milestone’ for the future of the Luton plant.

Mr Tavares added: “Performance is the trigger for sustainability and I would like to thank all stakeholders involved and underline the open mindset of our union partners as well as that of the UK Government“.