Stellantis will invest £50 million ($63 million) in its Ellesmere Port facility in the United Kingdom to install a new assembly line for electric vans, while warning the government that regulatory penalties under the country’s zero-emission vehicle (ZEV) mandate could threaten the plant’s profitability.
According to a report by The Times, the investment will support production of battery-electric versions of the Opel and Vauxhall Vivaro vans and related models starting next year. The new funding doubles the originally planned investment in the facility.
The expansion follows Stellantis’ decision to close its Luton plant, shifting production of medium-sized electric vans to Ellesmere Port.
However, the automaker has cautioned that current UK regulations could make operations financially unsustainable. The ZEV mandate sets annual targets requiring manufacturers to sell increasing shares of zero-emission vehicles.
For light commercial vehicles, the required share of zero-emission sales is set to rise from 10% in 2024 to 100% by 2035. The current quota stands at 24%, meaning nearly a quarter of all vans sold must be fully electric.
Stellantis Europe Chief Emanuele Cappellano said the company remains committed to its investment in the site.
“We are going ahead as planned with the commitments we made at Ellesmere Port,” Cappellano told The Times.
However, he warned that the regulatory framework presents challenges for manufacturers.
“Operating in the UK is currently unsustainable under the regulations and there is an urgency for that to be addressed,” he said.
Under the current ZEV mandate, manufacturers face penalties of £18,000 for each vehicle that fails to meet the required zero-emission sales targets.
The Ellesmere Port plant currently produces around 14,500 small electric vans annually. Production of the medium-sized electric models is expected to improve utilization at the facility, though its long-term profitability remains uncertain.
Demand for electric vans in the UK remains relatively limited. Industry data cited in the report indicates that electric vans account for less than 12% of total van sales so far this year, even as the ZEV mandate requires that 70% of new vans sold be electric by 2030.
Ellesmere Port previously produced models such as the Opel and Vauxhall Astra but was converted into a fully electric vehicle factory in 2021. The plant now employs around 950 workers producing electric versions of the Vauxhall Combo, Citroën Berlingo, Peugeot Partner and Fiat Doblo vans.
The facility has also supported Stellantis’ international production network. Last year it manufactured about 30,000 vehicle bodies for export to a Stellantis plant in Algeria, while most of the 14,500 finished electric vans produced were also shipped there due to weak domestic demand.
Stellantis has invested about £100 million in the transformation of the Ellesmere Port site in recent years, including reducing the plant’s footprint by about 60% as part of its conversion to electric vehicle production.