Ever since Steve Girsky an his “merry band of hatchet men” touched down in Rüsselsheim, Bertel has been warning that GM’s European division was about to embark on a serious cutting binge. But our worst fears, namely that Opel could go away entirely, have yet to be realized. Instead it seems that self-destructive mutilation will be attempted first, in order to stem the gushing red ink at Opel where at least €1b in losses are expected next year. Automotive News Europe [sub] reports that the first round of cuts will hit Opel’s Internationalen Technischen Entwicklungszentrum (ITEZ, “International Technical Development Center), as an IG Metall union document foresees some 1,420 product development position cuts (from a staff of some 6,000).
Opel’s spokesfolks insist that the union’s numbers are “factually wrong and excessively high,” but only, in the words of ANE, because they “include people who are not on Opel’s payroll – like employees of service providers and supplier employees.” Furthermore, the automaker has not offered an alternative number for the expected cuts, and given the close cooperation between unions and OEMs in Germany, not to mention the detail of the IG Metall leak (200 employees will be offered severance payments when 550 positions are transferred to the manufacturing engineering department from product engineering), it’s tough not to conclude that the number is fairly close to GM’s actual plans.
And the cuts aren’t limited to workers: a battery-powered version of Opel’s forthcoming “Junior”/”Allegra” city car, as well as a long-rumored Insignia-based Coupe are said to be on the chopping block as well… so let go of any plans to wait for a reborn Buick Riviera. Oh, and don’t hold out any hope for the “production potential” Opel recently touted for its strange, low-cost RAK e Concept. Meanwhile, here are the other measures that Opel admits are coming down the pike:
• Stronger concentration on the carmaker’s core development mission and a reduction in project coordination tasks
• Increased use of modules and construction kits. “For example, we still have too many steering and seating systems. We have to improve significantly here,” the spokesman said.
• Deeper and earlier integration of suppliers. “There are no plans to put a stranglehold on our suppliers — we need to increasingly rely on suppliers’ innovative strengths,” the spokesman said.
In short, it seems that in order to save Opel, GM has to kill off much of what made Opel so valuable to it, namely its ability to develop premium global vehicles for the parent company. Instead it seems Opel will be forced to concentrate on selling into a brutal European market that seems set to contract as the Euro crisis drags on. Perhaps there is some truth to the rumors that Chevrolet will slowly replace Opel after all.
After all, cutting engineer positions is certainly the low-hanging fruit in Opel’s restructuring, but GM will likely have to go after assembly capacity (likely at Bochum and Port Ellesmere) in order to address the overcapacity issues that are at the heart of its (and many European automakers’) woes. That could create problems though, as this latest union leak confirms that Opel’s labor councils are prepared to fight. Opel’s outgoing union leader Klaus Franz has gone so far as to ask GM to sell Opel to its Chinese partner SAIC, a move widely considered a sign that Franz was trying to move back in touch with an increasingly militant union rank-and-file in the face of his own legal problems. While Franz portrays himself as the victim of a media smear campaign and threatens legal action against the Frankfurter Allgemeine Zeitung, his union appears prepared to fight the seemingly inevitable production cuts. And all this as Opel celebrates its 150th birthday.