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Ryton has a bright future, says PSA

PSA Peugeot-Citroen has hit back at fresh claims that its Ryton plant is set to close when production of the popular Peugeot 206 ends in 2008.

The plant, which is currently producing 190,000 206 models a year, has endured a turbulent last 18 months including job cuts and strikes by employees.

Workers at the Midlands plant are due to be told by the end if this year whether the 206 replacement, the 207, will be built at the site.

But a report by city analyst Goldman Sachs suggests PSA is stalling on making an announcement because it is planning to close the facility and shift production to its other European sites at Poissy and Mulhouse in France.

“PSA has long complained about Ryton’s competitiveness – citing lower productivity, poor quality, confrontational unions, logistics costs (shipping parts from France) and currency. Not all these criticisms are valid in our view but they may highlight management’s intentions,” the reports says.

“It is common knowledge that Ryton needs significant investment in a new paint shop and parts of the bodyshop if it is to remain open. We believe the company is likely to consider shutting some of its older facilities once newer, more productive capacity is on stream.”

However, PSA has hit back saying that talk of closure is unsettling the Ryton workforce, although it still did not give a definitive answer on the future of the plant.

“Over the last two years closure of the plant has been constantly talked about,” says Tod Evans, outgoing chairman of PSA Peugeot-Citroen in the UK. “All this does is merely destabilise the workforce. The plant has a bright future and continues to produce a car that is in great demand.

As and when we are clear when the 206 life is over we will then make a decision on the future of Ryton. The first people we will talk to is the plant workforce.”

Ryton is the only plant in Europe to produce the 206 GTi 180 and the SW variant, with more than 50% of production being exported to both right and left-hand drive markets.

However, in July last year, 2,400 workers were forced to take a pay cut in a last ditch attempt to save 700 jobs and in March this year PSA axed the fourth shift at the Coventry factory due to falling European demand. In the same month Ryton workers voted to strike over a new pay deal.

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