Britain Did Not Give Subsidies for GM to Produce Astra in the Country image

Britain denied rumors about offering GM special treatment to convince the company to manufacture the next generation Astra compact in England and not in Germany.

Last week GM declared that it will build the model in the UK after employees at the Ellesmere Port plant agreed to a new labor deal. Unfortunately this decision left the Bochum plant, Germany, which is run by Opel, in danger of being closed.

“It is important to be clear nothing ‘special’ has been offered to GM. Rather, they were simply made aware of the excellent business environment and support systems that the UK offers to all businesses,” said a spokesman for Britain’s Department for Business.

Vauxhall also declared it had not received any subsidy and has not applied for any government support. But rumors say that the government did offer GM subsidies to make sure production of Astra will begin at Ellesmere Port. If so such promises would contravene EU rules concerning subsidies. GM denied rumors saying that the decision to invest 125 million pounds ($197 million) at Ellesmere Port was due to the employees’ agreement with their working conditions. Production at the plant will begin in 2015.