General Motors’ European sibling company Opel will close its assembly plant in Antwerp, Belgium, by the middle of the year.
Forced to downsize after GM lost US$88 billion (AUD$97.4 billion) between 2005 and 2008, Opel CEO, Nick Reilly, said attempts by GM to find an alternative to closing the Antwerp factory were unsuccessful.
“In order to keep Opel going and have a sustainable future we have to take some of these types of decisions.
“You have to face reality. We are losing money and have to do something about it,” he said.
Unless an alternative is presented through union negotiations the closure process is expected to be completed by June or July with the view to eventually sell the land.
Mr Reilly earlier turned down what was effectively a 500 million euro ($783 million) offer from the Belgian taxpayers to keep the plant alive, despite still requiring 2.7 billion euros ($4.2 billion) in state aid to keep Opel afloat.
The manufacturer’s European works council is refusing to back the restructuring plan and believes the plant closure is a “breach of contract” and will lead to millions in extra unnecessary expenses.
Reilly confirmed Opel is not considering any other closures in the short term, but admitted production capacity will be cut by around 20 percent and around one-sixth of the company’s 50,000 employees would face the axe.
He said 4000 of the 8300 planned job cuts were expected in Germany.
(with Automotive News)