BUSINESS Secretary Lord Mandelson has agreed £270m worth of loan guarantees to Vauxhall owner General Motors Europe.

The funding is part of a multi-billion- pound investment in the future of car production at plants across Europe, including the Ellesmere Port site in North Road.

Friday’s outline agreement follows months of detailed and highly complex talks between the UK Government and GM.

The talks follow last year’s rescue of GM by the US taxpayer and a reversal of the car group’s decision to sell off its European operations.

The guarantee will be provided under the Government’s Automotive Assistance Programme, announced last year in a bid to help the car industry pull out of the recent recession.

Lord Mandelson said: “I always said the Government would stand four square behind Vauxhall and with this announcement we have kept our word. These are excellent plants employing a first-rate workforce.

“We need Vauxhall to thrive as part of Britain's automotive manufacturing base and following our negotiations with GM Europe I am confident it will do so.”

Vauxhall said it was ‘very pleased’ with the announcement, adding that it represents ‘a strong vote of confidence’ in the UK car industry.

The company said it means that Vauxhall, and its German sister company, Opel, can forge ahead with its restructuring, including the introduction of new models and a third shift at Ellesmere Port.

Nick Reilly, General Motors CEO in Europe, said: “We very much appreciate the support of Lord Mandelson and the British Government which is a vote of confidence in Vauxhall, helping to sustain jobs and manufacturing operations in the UK.”

Ellesmere Port and Neston MP Andrew Miller said: ‘This is a Labour Government in action, supporting our manufacturing industry.

“We will continue to work with General Motors on the next generation vehicle because Labour is determined to see a long- term future for vehicle manufacture in Ellesmere Port.”