The Business Secretary, Lord Mandelson has announced a 300 million Euro loan to GM Europe, a move that has been welcomed by an industry expert at Coventry University.

Professor David Bailey, from the University's Business School said that the loan guarantee, which will be provided under the Automotive Assistance Programme (AAP) will be provided alongside support from GM Europe's US parent company and assistance from other European governments.

Professor Bailey said: "This is the first time the AAP has paid out on a substantial basis, following the failure of the government to deliver a prompt and acceptable support package to Jaguar Land Rover last year. JLR eventually found a private loan guarantee to access the EIB loan it wanted, on better terms than the UK government was prepared to offer."

Speaking on Monday 15 March, Lord Mandelson said that the Government had promised it would stand foursquare behind Vauxhall in order to keep the excellent plants and its first rate workforce and that following negotiations with GM Europe, he was confident that Vauxhall would thrive as part of Britain's automotive manufacturing base.

Professor Bailey added: "GM is continuing discussions with other European governments to obtain support but has said it is happy with the UK government's support.

"To be fair to Lord Mandelson, the government appears to have learned lessons from last year's AAP fiasco, and this time round have delivered an effective and timely support package to maintain GM in the UK. That in turn will safeguard UK jobs.

"Although, I have been critical of the Labour government's stance towards auto and manufacturing, this time it appears to have delivered. Jobs and efficient operations at Ellesmere Port and Luton will now be supported."

"The next big challenge will be persuading GM to bring European production of its Opel / Vauxhall Ampera electric car to the UK. Today's package is a step in that direction."