The discount food giant is consulting residents on plans to take over the Metro Hotel and Broadway Bar site on Birmingham Road and build a new branch there.
But the proposal has been met with anger and bemusement from people living nearby who are concerned their daily commute to and from work will get even worse than it is now.
Residents, along with all three Paddock ward councillors, are urging the company to look at more suitable options which are available nearby.
If the plan was progressed, work would be carried out to demolish the bar and hotel and create a supermarket with a retail area of 1,370 square metres and 76 parking places.
In their consultation document, Lidl said their new store would provide a store for the community and create around 40 new jobs.
But Councillor Nick Gandham, who runs the Broadway bar, said more than 40 people were already employed across both the hotel and bar businesses and would be lost if they were to close.
Rex Sandhu, who lives nearby, said: “I think it is the wrong location. This area is just so busy. This would add to the problems we experience everyday.
“I work in Telford and the biggest part of my journey is getting to the motorway. I can’t imagine how bad it will be if Lidl came here.”
Another resident Shin Ark said: “I don’t think they would do that well after a while because people will start getting fed up and turn back round. It is heavily congested as it stands.
“There are better alternative sites available. Literally down the road in Bescot which is ideal. Everything is in place for it. Aldi opened up in Crown Wharf in town and that is perfect and made for such developments.”
And Prinder Hargun added: “This is quite a good community hub to meet. Where do we go if this closes down. And we’ve seen generations of people who have grown up here now coming here.”
Last month, the authority’s planning committee opposed a bid by Walsall Housing Group to build 29 homes on land off Cricket Close – around the corner from this site.
A big concern from residents and councillors for that was the impact extra traffic would have on the amenity for people living in the cul-de-sac.
Councillor Waheed Rasab said: “This is a main road and gateway to Walsall from Birmingham and Great Barr.
“You have huge issues with traffic and they are introducing Sprint and there has already been planning permission turned down on Cricket Close next to here.
“We don’t need this. We respect Lidl, they provide good quality stuff but we have it just down the road. Why would you want another one here?”
Councillor Gandham added: “Our residents are upset with the fact their daily commute has increased.
“Having Lidl part of the Paddock ward would be catastrophic for the commute two and from work in rush hours, weekends.
“It would lead to increased traffic and pollution. Residents who have spoken to us are against it.
“Lidl say they are creating 40 jobs – where are the 40 plus jobs currently here going to go?
“We employ over 40 people across the bar and the hotel. It makes no sense to us. People rely on us for their livelihoods. People are worrying as they’ve been here for years.
“We want to promote local businesses and the long term plan is to create more of a community hub here.
“We have a lot of meetings held here outside of working hours, we sponsor football teams, charitable events and engaging the community.”
And Councillor Gurmeet Singh Sohal said: “There are empty retail spaces in Bescot down the road that are ready, fit for purpose, ample parking and won’t cause issues.
“Everyone will be coming here. You won’t be able to move on this section of the road and it will cause tailbacks from Junction 7.
“We’re not discouraging investment into Walsall. We absolutely welcome it. But had Lidl come to us we’d have suggested more suitable locations.”
People can take part in the consultation via rapleys.com/consultation/lidlbirminghamroad.
Lidl has been approached for comment.