GM warns Opel plant may be shut down
Source: AFP |
January 23, 2013, Wednesday
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Print Edition
Print Edition
A TOP executive of General Motors has warned that the Bochum plant of loss-making Opel in Germany could be closed two years early if management and unions do not agree on a turnaround plan.
Opel announced in December it will halt auto production at Bochum plant in 2016, but pledged to keep it running as a parts distribution center.
Nevertheless, management and unions must "come to an agreement in February," or the plant could be shut down at the end of 2014, GM vice chairman and Opel supervisory board chief Stephen Girsky warned in a letter to Opel's workforce.
"If no agreement is reached in our negotiations, we'll keep to our existing site agreement, which expires at the end of 2014," Girsky wrote.
"That means Zafira production in Bochum would end and all production activities in Bochum be completely shutdown by January 1, 2015."
Opel employs about 3,200 people at Bochum.
The carmaker, which has lost money for years, is hoping to launch a number of new models over the coming years, and also cut costs in order to steer back to profit.
Girsky said the workforce must be prepared to make sacrifices.
"All employees must make their contribution," he said.
Opel could not, for example, afford wage increases as long as it was in the red, Girsky argued.
But GM would be "ready to support Opel financially, as soon as it is in a position in Germany to be competitive and profitable once again."
The situation for the entire European car market "remains catastrophic. That is a difficult basis for the upcoming talks," Girsky said.
GM estimates it stands to lose more than US$1.5 billion on its European operations this year and wants to steer Opel and its British sister brand Vauxhall back to profit by 2015.
Opel and Vauxhall are dependent on the European market.
Opel announced in December it will halt auto production at Bochum plant in 2016, but pledged to keep it running as a parts distribution center.
Nevertheless, management and unions must "come to an agreement in February," or the plant could be shut down at the end of 2014, GM vice chairman and Opel supervisory board chief Stephen Girsky warned in a letter to Opel's workforce.
"If no agreement is reached in our negotiations, we'll keep to our existing site agreement, which expires at the end of 2014," Girsky wrote.
"That means Zafira production in Bochum would end and all production activities in Bochum be completely shutdown by January 1, 2015."
Opel employs about 3,200 people at Bochum.
The carmaker, which has lost money for years, is hoping to launch a number of new models over the coming years, and also cut costs in order to steer back to profit.
Girsky said the workforce must be prepared to make sacrifices.
"All employees must make their contribution," he said.
Opel could not, for example, afford wage increases as long as it was in the red, Girsky argued.
But GM would be "ready to support Opel financially, as soon as it is in a position in Germany to be competitive and profitable once again."
The situation for the entire European car market "remains catastrophic. That is a difficult basis for the upcoming talks," Girsky said.
GM estimates it stands to lose more than US$1.5 billion on its European operations this year and wants to steer Opel and its British sister brand Vauxhall back to profit by 2015.
Opel and Vauxhall are dependent on the European market.
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