EMCC European Monitoring Centre on Change

Opel

Company/Organisation:
Opel

Geographic Location

Country: Germany

Company

Sector: Manufacturing
Manufacture of transport equipment
29.1 - Manufacture of motor vehicles
Number Employed: 32400
Group: General Motors

Employment Effects

Announcement Date: 14-10-2004
Planned Job Reductions min: 10000
Planned Job Reductions max: 10000
Type of Restructuring: Internal restructuring
Employment Effect Start: 14-10-2004
Foreseen End Date: 31-12-2008

Additional Information

General Motors unit Adam Opel AG will cut 10,000 jobs in Germany by 2008, with 4,000 jobs to be shed at the Ruesselsheim and Bochum plants, said Rainer Einenkel, the deputy head of the works council for Bochum. Some 3,000 jobs in Bochum will be shed in 2005, while another 1,000 will go by 2007. In an internal comparison of all its European factories, GM found that the Bochum site was in last place with regard to costs. The site is the group's largest factory in Europe, with 7,600 staff, but is less productive than other sites as it is relatively old. Part of the factory would be closed at a later stage. Activities at the site are to be divided into three areas: vehicle assembly, production of axles and the moulding factory. In taking this step, Opel is preparing to close down at least the vehicle assembly activities in the long term, which would affect around 2,000 staff. The moulding factory is to be spun off into an independent limited liability company and will be maintained for the time being, as it also produces parts of the bodywork for Opel's sites in Russelsheim and Eisenach. It is thought that the production of axles could be transferred to eastern Europe, possibly to the Czech Republic. Some 4,000 jobs will be cut in Ruesselsheim by 2008. Zurich-based GM Europe would not confirm the figures. Apart from Bochum and Ruesselsheim, Opel operates two other plants in Eisenach and Kaiserslautern, and employs about 32,400 people in total in Germany. GM Europe earlier announced it aims to slash its workforce by 12,000 over the next two years as part of plans to cut its annual operating costs by € 500 million by 2006. Some 90% of the jobs will be cut in 2005, with a majority of the headcount reductions taking place in Germany. Some 2,000 jobs will be cut at the main plant of GM Adam Opel AG unit in Ruesselsheim by 2007 the company said on 15 December 2004. February 2005: several hundred employees left their jobs at the end of January as part of Opel's compensation plan. GM has demanded that Opel cut 6,500 jobs at its Russelsheim, Bochum and Kaiserslautern sites. So far, around 6,000 Opel employees have either voluntarily subscribed to or already signed contracts for GM's compensation plan. Opel employees have until 25 February 2005 to take advantage of the compensation packages, which have been described as generous. GM has set aside $1 billion for the compensation of Opel staff. However, staff councils and trade union representatives in Bochum have accused Opel of not allowing employees who have worked for Opel for a long time to leave, due to the higher level of compensation to which they are entitled