It’s rather incredible, but this could be the cost for the European unit of General Motors when it closes the home country plant – according to two sources with knowledge of the proceedings.
Although the manufacturing facility in Bochum, Germany is closing to save money for the loss-making unit, the charge to do it is rather steep – mainly because of the high value workforce payments made in Germany. The two persons with knowledge on the matter say the 550 million euros are for the payments made to the 3,300 employees of the factory – in the form of early retirement schemes and severance payments.
According to a report in Germany’s daily Frankfurter Allgemeine Zeitung, besides the employee cost, the closure would also incur other costs – on top – for cleaning up the plant site and transfer all the necessary tools and equipment to the Ruesselsheim factory, where Opel is shifting the assembly work for the Zafira model built at Bochum. According to the paper, the company’s senior management has already signed on the 550 million charge, after Opel started negotiating a deal with its employees since last April when it was announced that its Bochum manufacturing facility is going to be closed as part of its broader plan to achieve profitability since 2016.