Opel Confirms Bochum Plant Will Be Closed at the End of 2014 image

GM’s Opel executives decided today that the Bochum plant will be closed at the end of 2014, the first German facility to be closed since World War II.

Opel announced today that its supervisory board approved the managers’ decision to stop vehicle production at the Bochum plant. GM’s European divisions, Opel and Vauxhall, have accumulated losses of $18 billion since 1999. GM promised to reach the break-even level in Europe by 2015 and for this it will invest 4 billion euro in Opel to introduce 13 new engines and 23 new models in the following three years.

As the auto market in Europe heads towards its sixth year of declines, Opel and Vauxhall’s first quarter sales on the Old Continent dropped 7.9% to 208,994 vehicles, compared with industrywide deliveries which dropped 9.7%.

Although in March workers at Bochum plant accepted forgoing pay rises if the company will keep production of the Zafira minivan by the end of 2016, GM tied the deal to it plan to expand a logistics center at Bochum and replace auto manufacturing with parts production after 2016. The plant currently has 3,000 employees and GM’s plan would keep 1,200 jobs. Ulrich Weber, an Opel spokesman, said that this plan is ‘off the table’ as concessions were rejected.