General Motors (GM) Thursday said it will produce the next version of its best-sellling European model in England.
The decision raises the stakes for negotiations with employees at its Bochum, Germany, plant, which had hoped to gain production of the next generation Astra, now scheduled to begin in 2015. The decision is one of the most dramatic so far as Europe’s carmakers look to restructure or consolidate in response to more than four years of falling demand and profits.
In exchange for losing the Astra, Rüsselsheim will take over production of the Zafira, a move which would inevitably lead to the closure of the Bochum plant.
According to a policy paper called “Global Assembly Footprint” cited in Der Spiegel, the Bochum plant will be closed by 2015 at the latest. The Bochum factory currently employs 3,100 workers. Another 2,000 are employed in subsidiary companies and around 15,000 in supply companies.
A company spokesman confirmed that the Bochum plant would continue to produce the Zafira minivan and an older model Astra for the Eastern European market through 2014, but no decisions about the fate of the factory beyond that have been made, according to Bloomberg Businessweek.
However, German manufacturing union IG Metall said on Friday it will not accept any Opel plant closures in the country. Regional union leader Armin Schild told German public broadcaster ZDF there would be “a fierce fight” with parent company GM’s management, should it come to shutting down Opel facilities at the plants in Bochum or Rüsselsheim.
Many Opel factories are running well below capacity, which is extremely costly because the facilities sap capital and other resources even when they are not running.
GM lost $747 million on its European operations last year, having lost money in Europe for 12 straight years.