Peugeot boss offers UK union reassuring words on Vauxhall plants

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Carlos Tavares, Chairman of the Managing Board of French carmaker PSA Peugeot Citroen, arrives to attend a news conference to present the company's 2016 annual results at Peugeot headquarters in Paris, France, February 23, 2017. REUTERS/Gonzalo ... Fuentes (Copyright Reuters 2017)

The head of French carmaker PSA played down the threat to British plants as he discussed his potential takeover of GM's European operations during a visit to London on Friday.

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Carlos Tavares, chief executive of Peugeot-maker PSA, has been on a charm offensive to reassure politicians and unions that any deal to buy the Opel business would not lead to large-scale job losses.

Germany accounts for about half of Opel's 38,000 staff, while 4,500 are in Britain where Opel operates as Vauxhall.

Tavares met the Unite union's General Secretary Len McCluskey on Friday.

"He talked in terms of not being here to shut plants. That's not his nature," McCluskey, the head of the country's biggest union, told reporters, adding the talks were "relatively positive".

The union leader said he was pleased with some of the assurances Tavares gave, such as production commitments being met should the takeover go-ahead.

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But McCluskey said there remained a lot of issues to discuss, including that of pensions.

The Vauxhall pension scheme has a deficit of up to 1 billion pounds ($1.25 billion) according to a source.

In a statement PSA said Tavares used the meeting to reaffirm "his commitment to conduct this dialogue in accordance with existing agreements and the ethical approach of the PSA Group."

PSA said this week it would respect existing labor agreements if a deal took place.

Underlining concerns about jobs, Opel's European works council said it had agreed to open a line of communication with its counterpart at PSA Group.

Tavares was also due to meet Britain's business minister Greg Clark on Friday. He has already discussed the GM deal with Prime Minister Theresa May by phone.

(Reporting by Costas Pitas, editing by James Davey)