It’s the 50th anniversary of General Motors Co.'s car plants at Bochum in western Germany and Ellesmere Port in northwest England but the mood is far from festive at these plants amid talks that they may have to close. Auto sales in Europe have suffered tremendously because of the weakening economy. The sector was forced to address a capacity overhang.
According to GM CEO Dan Akerson, it has an excess of 10 plants throughout Europe. Opel/Vauxhall has reassured everyone that these plants won’t be closed before the end of 2014 but many believe that the Bochum factory and the Vauxhall plant at Ellesmere Port (its lone remaining plant in Britain) would be included in those that will be shut down.
Last Wednesday, there was a private meeting composed of the members of Opel's supervisory board. It was uncertain if management would present a mid-term business plan at the meeting, which includes plant closures. It’s possible that they wouldn’t talk about this sensitive issue at the meeting.
A source said that even if the closures won’t be part of the agenda, there’s indication that this matter will escalate. Akerson and Opel Chairman Steve Girsky are encouraging Opel CEO Karl-Friedrich Stracke to reduce the automaker’s breakeven point by transferring production from high-wage countries in western Europe to the growing markets. [source: Autonews]