The Truth About Cars » Bochum The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Wed, 23 Jul 2014 16:29:19 +0000 en-US hourly 1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » Bochum Opel Reaches Severance Deal With Bochum Workers Tue, 17 Jun 2014 12:00:35 +0000 Opel - Picture courtesy

General Motors subsidiary Opel has come to terms on a severance package for workers at its Bochum factory, set to close this year as part of the company’s restructuring plan.

Reuters reports Opel’s management reached a “binding and reliable” agreement with German labor union IG Metall. NASDAQ adds workers will receive €552 million ($748 million USD) in social benefits as a result of the agreement.

The closure of the plant — including an additional €60 million ($81 million USD) for related investments — will add to the burden of non-recurring costs for Opel, which also include currency challenges. GM expects Opel will become profitable by 2016 at the earliest, having accumulated $15 billion USD in losses beginning in 1999.

In a separate deal made in April, parts of Bochum will be purchased by Deutsche Post, bringing with it 600 jobs and a multi-million euro investment into the 20-acre facility.

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Opel Workers In Bochum Walk Off The Job Wed, 22 May 2013 17:45:46 +0000

First signs of the interaction between Opel and its  Bochum workforce getting nasty.  Today, Opel workers in Bochum stopped the lines for several hours to attend a so-called “information session” with the works council, Germany’s Automobilwoche [sub] says.

Workers and works council have not agreed that the production of the Zafira will be moved to Rüsselsheim at the end of 2014. They want to know how much Opel will pay in severance, and whether there will be other jobs for the more than 3,000 workers.  The move of the Zafira production from Bochum to Rüsselsheim will cost Opel  about $130 million, said Rainer Einenkel, head of the works council.

Technically, these information sessions are not a strike. There could be more  “information sessions” if there are no answers. Yesterday, Opel said it will keep the spare-parts distribution center in Bochum open until 2016 at its plant in Bochum, Bloomberg says. This in fulfillment of a contract with a logistics company not as a concession to the unions.

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Opel’s Zafira To Remain In Germany Wed, 15 May 2013 15:34:29 +0000 Zafira

GM won’t punish its German workforce for the uppity behavior of Bochum’s employees. Instead of moving production of the Zafira to UK’s Ellesmere Port, as some expected, production will remain in Deutschland.

According to Reuters, “General Motors’ loss-making European brand Opel will move production of the multi-purpose vehicle Zafira to Ruesselsheim in Germany, shoring up its headquarters as it prepares to close another German site.”

“The decision strengthens the traditional Hessian plant and will increase capacity utilization. Ruesselsheim will thus be the exclusive plant for the two biggest and most sophisticated Opel/Vauxhall model lines,” GM said in a statement.

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Who Will Get Opel’s Zafira When Bochum Closes? Mon, 13 May 2013 11:21:25 +0000

Now that Opel workers in Bochum refused a plan to keep the factory open, now that an intervention by UAW’s Bob King went exactly nowhere, the question is where to move production of the Opel Zafira when Bochum closes its doors by end of 2014.

In the running: Rüsselsheim, Germany, and Ellesmere Port, UK.

Both locations are top options on the lists of GM and Opel managers, Automobilwoche [sub] says.  Opel’s board of management will make a decision by June, which the supervisory board will have to approve.  A member of the supervisory board told Automobilwoche that  “business aspects” speak for Ellesmere Port, however, he hopes  that the Zafira will remain in Germany.  The union has half the seats of Opel’s supervisory board, and we know what the unions hope.

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Porsche Snaps Up Opel Workers Thu, 02 May 2013 11:18:28 +0000

Porsche is looking to fill 1,400 jobs in for its expanded factory  in Leipzig, where the new Macan SUVlet will be built by the end of the year. A lot of these jobs will go to current Opel workers, says Germany’s Focus.

According to the report, Porsche received  32,000 applications for the 1,400 jobs, “most of them by Opel workers in Bochum, where the plant will be closed by the end of 2014.”  Porsche is looking for 1,000 workers and 400 engineers. Already, a complete Opel team changed sides to work in the new paint shop in Leipzig.

Changing jobs is more attractive to younger workers. Workers who have been at Opel for decades will make more money by waiting to get fired before the plant closes and to collect very generous severance payments of between $200,000 and $300,000.

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Opel Abandons Bochum Completely Mon, 29 Apr 2013 10:44:01 +0000

Bob King’s attempts to ingratiate himself with German unions, and to make Opel’s Bochum workers reconsider their decision to turn down Opel’s restructuring plan, are being ignored. Actually, it appears as if they had the opposite effect. Days after King’s comment, Bochum plant manager Manfred Gellrich rejected new discussions, saying Opel does not want to “waste precious time,” Reuters says. Over the weekend, Opel dropped another bomb: Bochum will be closed completely. A parts depot that was supposed to stay open, will also close its doors.

With the shuttered logistics center, another 420 jobs will be lost, raising the number of redundancies to 3,700, says Der Spiegel. “It does not make sense to leave the distribution center in Bochum,” once manufacture of cars stops, an Opel spokesman told the magazine. Bochum’s works council had not put much faith in the plan in the first place – one of its reasons for rejecting the plan. Opel has another parts center in Rüsselsheim.

The Bochum plant is scheduled to close by the end of next year. Opel will move the production of its Zafira MPVs elsewhere, two years before a planned model changeover.

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Bob King Intervenes In Bochum, Receives Cold Shoulder Wed, 24 Apr 2013 13:54:46 +0000

UAW boss Bob King told Opel’s Bochum workers to vote again, and to this time accept a deal that had been worked out between the German metal worker union IG Metall and GM.

According to Reuters, “UAW President Bob King, who is a member of Opel’s supervisory board, said on Tuesday that workers at GM’s Opel plant in Bochum, Germany should ask to vote again on the restructuring deal they rejected last month that would have kept the plant open through the end of 2016 and retained 1,200 of the more than 3,000 employees.”

The plan had been overwhelmingly rejected by Bochum’s workers. The plant is now scheduled to close by the end of 2014.

King, who oddly sits on Opel’s Supervisory Board as a representative of the union despite being the chief of one of GM’s biggest shareholders, said he “would really hate to see that plant closed when so much effort was put in by IG Metall and the works council to save it.”

The plan is likely to fall on deaf ears. “We gave the employee a clear choice,” spokesman Harald Hamprecht told Reuters. “We respect the outcome. The Opel supervisory board acted accordingly and we are moving on.”

Bochum’s workers have not been heard of, but it is unlikely that they are sympathetic to the plan. They had accused their unions of throwing them under the bus, and they probably won’t listen to a major shareholder of GM.

King is trying to curry favors with IG Metall, and to enlist its help for the UAW’s efforts to organize the U.S. plants of German transplants.


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Opel’s Bochum Workers Reject Deal, Prepare For Costly Battle Fri, 22 Mar 2013 13:31:08 +0000

GM has a huge problem in Bochum – or an unexpected opportunity.  Workers at Opel’s Bochum plant yesterday refused a restructuring plan that would guarantee auto production in Bochum through 2016, and that would keep the plant making components after that. GM answered on the same day:  ”Production of the Zafira Tourer and  the waiver of enforced redundancy will end after 2014.” This would open the door to closing the doors in Bochum.

It also could become extremely costly for GM.

After other Opel plants had voted to accept the restructuring plan, workers at Bochum rejected the proposal yesterday with 76.1 percent of the votes,  Automobilwoche [sub] says.

Currently, there is a contract that keeps jobs safe and plants open through 2014. The restructuring plan would have extended the production of the Zafira through 2016. After 2016, Bochum would have been used for component manufacturing and a parts depot, employing 1,200 workers. Currently, 3,900 people work in Bochum. This number can now be reduced to 420.

What sounds like a win for Girsky & Co. can become a huge drain on GM’s profits. According to German law, GM can close the Bochum plant, however, it would have to offer jobs at other German plants.  If Opel wants to get rid of workers and payroll, it must negotiate a restructuring plan with the works council. That failed yesterday. If there is no plan, and  if  the works council opposes, fired workers  can and will sue Opel. The severance payments will then be determined in court. This mean s huge exposure for a large company with deep pockets and few friends in Germany.

Assuming an average negotiated severance payment of $200,000 per worker (using  Opel’s Antwerp and Ford’s Genk plant as examples), a good negotiated deal with a cooperative works council would cost GM upwards of $700 million. In an adversarial situation, this number could quickly snowball to several billions. A few weeks ago, Bochum works council chief Einenkel  promised “the most expensive plant closure of all times.” He said it “ would cost GM billions,” and that “Opel would not survive this.”

It looks like the Bochum workers have written off Opel and want to get out for as much money as possible. In their situation, I would do the same.

The refusal of Bochum’s workers also signals troubles with the IG Metall union. The Bochum works council had been increasingly at odds with the unions.

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Trying To Sort Through The Opel Mess: It’s A Pre-Programmed Crash Fri, 01 Mar 2013 19:28:40 +0000


I have been trying to make heads or tails out of yesterday’s contradicting news about the big deal between Opel and the unions, and so does German media. So much is clear: The truth and GM’s press release about a “successful conclusion” of the negotiations with the Opel works council are miles apart. There is no deal. Unions and Management are still in negotiations, the negotiations will continue this coming week. Then, the workers have to vote. It does not look good: Bochum’s works council is dead set against the deal. It gets worse.

Bochum’s works council chief Rainer Einenkel tells Handelsblatt that he “does not agree” to the deal. He characterizes his negotiations with management as “very brief.” He says that management told him that there is “nothing to discuss,” and that Bochum either says yes, or jobs will be imperiled from 2015 on.

Einenkel did not want to sign on to what appears to be on the table:

  • Opel continues building cars in Bochum, at least through 2016
  • The Bochum auto plant will be converted into a component and logistic hub for a total of 1,200 jobs or more.
  • Opel attempts to settle new companies and technologies in Bochum, and expects ”a four-digit number of high-quality, new industrial jobs.”
  • Bochum goes from three shifts to two, at the expense of 700 jobs, starting in the second quarter of 2913. Affected workers will receive “attractive severance packages and partial retirement programs.”
  • Production and jobs at the other three German plants in Eisenach, Kaiserslautern and Rüsselsheim are safe.

And what would the concessions of the unions be? What would Opel get in return?

  • The payout of salary increases under the collective bargaining system is deferred until the next salary increase goes in effect.

The last “concession” makes you wonder how bad the situation really is at Opel. Management had tied its hands before and agreed to keep plants open through 2014. Now it puts itself into handcuffs and agrees to keep the doors open and the lights on in Germany through pretty much the end of the decade? And the price for that is what? A contractual pay raise on credit? How much are we talking about? Let’s check.

Last October Opel owed its German workers some $15 million due to a 4.3 percent pay hike negotiated for all IG Metall workers in May. That money was paid in November. The next contractual pay hike is due this May. Then, another $15 million are due. After that, the workers will get their extra 4.5 percent monthly, and whatever the next raise is will be loaned to Opel for another year. Let’s call that $30 million, or three years of Akerson’s salary. Is Opel so hard up for money that it has to bargain away its ability to make serious adjustments of its capacity for what looks like a payday loan? Remember: These are not salary concessions. Instead of getting paid monthly, it’s paid by the end of the year.

And it’s not that the bleeding will stop. Those 700 jobs of the third shift? They will be very expensive to make go away.

Let me again kill a myth. It is not impossible to close a factory in Europe. Not at all, if you have the money. You can close factories to your heart’s content. You can’t fire the people. If you do, it costs you. A lot.

The closure of Ford’s Genk factory was estimated at $1.4 billion, or $332,000 per worker. Ford allocated money, the matter went down with a minimum of fuss. When GM closed its Antwerp facility, it did cost GM around $532 million in termination benefits. Divided by 2,600 workers, it came out to a little bit over $200,000 per worker.

How much do you think those “attractive severance packages” for the third Bochum shift will be if there is a contract that says that their jobs are safe through 2014?

How much will it cost to shift 1,000 workers into those mythical “high-quality, new industrial jobs?” The workers aren’t stupid. Every year they worked at Opel is worth serious money in severance when they get fired. Close to retirement, very serious money. They won’t give it up for nothing. You will have to pay them – a lot – to take those high quality jobs.

Ford did the right thing. It bit the bullet, paid, and moves on. GM on the other hand …

Opel and GM strike me at someone who refinances to a few bucks of a lower payment, but with a much bigger balloon a few years down the road. There is only one way to escape the inevitable: Take Opel bankrupt. The more problems are being kicked down the road, the more attractive and likely a bankruptcy will get.

 Today is Karl-Thomas Neumann’s first day on the job as Opel CEO and chief of GM Europe. Germany’s news channel N-TV greets him with the headline:

“The Opel Adventure Begins: Neumann Takes The Ejection Seat.”

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GM’s Euro-Trash: All Agree On Opel Deal, Except For The Union Boss Thu, 28 Feb 2013 17:51:31 +0000

I shall not be moved: Opel union chief Einenkel

Messy, messy, messy: Can’t even close a proper deal with the unions. GM and the unions have an agreement. It is basically as reported this morning. The deal has the signatures of management and unions. One signature is missing, reports Die Welt: That of Bochum works council chief Rainer Einenkel.

With the missing signature, there are doubts whether the deal is legally binding. Says Die Welt: “The courts may have to decide.”

Both GM and the metal worker union IG Metall are interested in bringing the matter behind them. Steve Girsky needs to report mission accomplished to Detroit (even if the result is dubious). The metal worker union already has its eyes on a much bigger prize: The new round of collective bargaining.

The unions want a raise for all 3.7 million German metalworkers, and the chances are good. Volkswagen reported record earnings, BMW and Daimler also have solid profits. The unions want 5.5 percent more this year. They would have bargained for more, would Ford and Opel not be in the poorhouse in Europe. GM wants to pay its workers zero percent more, “but the Americans don’t know the German system well enough,” Opel-union boss Schäfer-Klug told Focus. “Germany has a collective bargaining system, and Opel can’t undermine it. Neither IG Metall nor the other automakers will accept that.”

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Armistice Confusion At Opel: Unions 2, Girsky Nil – Wait, Game Not Over? Never Mind … Thu, 28 Feb 2013 11:26:34 +0000  

If you think that GM will get a handle on its abundant capacity problems in Europe – abandon all hope. Or rather: Postpone hope for until after 2016, or maybe later. Also, write off any  expectations that Steve Girksy would successfully play hardball with German Metalworker Unions. Deadball is more likely. With the decision to move the production of Opel’s Astra volume model from Rüsselsheim to Ellesmere Port, and to shift production from Bochum to Rüsselsheim, the fate of the Bochum plant appeared to be sealed.

German unions declared war. Minutes ago, Opel works council chief Wolfgang Schäfer-Klug announced “an armistice” (Das Handelsblatt) and told German media that Opel will continue making cars in Bochum through 2016. Nobody can be fired, no plants can be closed at Opel until January 1, 2017. Even then, Bochum will remain open.

Currently, there is a firm contract with Opel unions that rules out plant closures and lay-offs through the end of 2014. Apparently, GM management decided to have its hands tied for at least two more years. Once car production ends, Bochum workers will find job security for another two years. Even after 2016, Bochum will not be closed, it will continue making components. Opel will have to pay salaries pretty much through the end of the decade.

According to the reports, this is an “agreement in principle.” It  is unknown what the unions offered in return. Girsky had set a deadline  for today and threatened, he would close Bochum by the end of 2014. He lost.

While Opel workers have gained a few years, they could do better: Volkswagen announced yesterday that each of its more than 100,000 workers in Germany will receive a bonus of nearly $10,000. While GM is scraping the bottom in Europe, VW writes a billion dollar “thank you” check to its workers.


Hours after the news made the rounds, Bochum works council Walter Einenkel said they are bogus: “There is no agreements, simply because our side did not have the opportunity to discuss this among ourselves, not to mention to clear the matter with management,” Einenkel  told Die Welt.  “In the meantime, we have received a so-called master agreement – I could only skim it. Neither me nor the other members of our committee are able to evaluate this in such a short time.”

Einenkel told the paper that he “had seen a lot” in his 40 years at Opel, but “this is matchless.”


Now, unions are “just about to reach an agreement,” says Reuters. IG Metall expects to strike a deal this week.

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Girksy To Opel Workers: Allow Me To Rip Out Your Heart, Or Else Mon, 25 Feb 2013 14:10:09 +0000

By Thursday, GM wants to have a definite deal with the Opel unions  at least that’s the deadline Steve Girsky has set. The parties are further apart than Dems and Reps over the sequester. Steve Girsky wanted the unions to agree that Opel’s toolmaking, prototype building and central production planning will be outsourced, or moved to GM’s plant in Gliwice, Poland, Der Spiegel says.  The unions are rightly horrified.

Should the unions say yes to that move, which would cost 700 jobs at home in Rüsselsheim, GM was ready to continue making cars in Bochum until 2016, and possibly provide a few parts making jobs after that. If there is a nein, Bochum will be closed by the end of 2014, or so the ultimatum goes. Opel workers are meeting as we speak in Bochum.

The interesting part is that toolmaking, prototype building and central production planning are centerpieces in the auto business. The engineering of a car and production engineering are more and more part of one big system. Moving toolmaking and prototype building to Poland would shift Opel’s center of gravity – into a Gliwice plant that just has been shifted back to the mothership and that would be safe in case of an Opel bankruptcy.

PS: The meeting in Bochum ended with the workers being told that there is no deal. Girsky wants a deal by Thursday. The unions say no to GM’s offers. It’s a one-sided negotiation: All jobs are safe through 2014 …

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German Government: No Bailout For Opel, Management To Blame Tue, 11 Dec 2012 18:07:22 +0000

A day after GM’s announcement to close down most of its Bochum plant, Germany’s vice chancellor and economy Minister Philipp Rösler blamed GM’s management for Opel’s misery. German carmakers like Volkswagen, BMW or Daimler are relatively unaffected by the European contagion, because they are successful in export markets. “It has been a mistake that Opel was more or less kept out of the growth market China,” Rösler told the Rheinische Post.  “There will be no financial help, because it won’t solve the management problems.”

Interim CEO Thomas Sedran was surrounded by a phalanx of security guards when he made his very short announcement yesterday. Outside, an armada of police was ready to intervene. The workers were peaceful, the security guards were not. A shop steward was knocked to the floor and choked by security guards, works council chief Rainer Einenkel told Der Spiegel. The union considered going on strike, but decided against it because there will be “short work” anyway in January.

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Opel Takes Steps To Close Bochum Mon, 10 Dec 2012 13:28:58 +0000

GM’s Opel will cease building cars at its German Opel plant. After 2016, no complete cars will roll off the lines at the 50 year old plant. Opel will keep a logistics hub in Bochum. The plant will continue making yet undefined components, Opel’s interim boss Thomas Sedran told German media today.

The decision will cost around 3,000 jobs.

Works council chief Rainer Einenkel does not accept the decision: “We will continue making cars in Bochum after 2016, he told DPA.

According to Reuters, the decision means that Opel  “came a major step nearer closing its Bochum plant.”


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Perspective 2022: Ten Years More Of Opel Losses Tue, 30 Oct 2012 15:07:54 +0000

We have documented how GM and Opel have a hard time separating themselves from the Bochum plant, something that is urgently necessary to address Opel’s dangerous overcapacity. The date to close the plant is being kicked more and more down the road and well past the use-by date of the current and some future Opel CEOs. Currently, it looks like Bochum and gaping wounds will stay open through 2017. Or maybe longer …

GM, Opel and the state of North Rhine-Westphalia started a working group with a noble cause: Create jobs in the region around the Bochum plant. Or rather “work streams on future utilization of the Bochum site.” Said GM Vice Chairman Steve Girsky:

“This working group will be all-inclusive, and have as members representatives of all stakeholders who wish to be involved in a positive way for the benefit of our employees and all the citizens of Bochum and NRW. We look forward to contributing our efforts, as well as our financial resources, to this important work.”

If the intent is to lure well paid Opel workers away from Bochum where they will get a few hundred thousand dollars in severance if they sit it out until the bitter end, then good luck.

The working group has an interesting name: “Bochum Perspective 2022.” Which is probably how long it will take to close Bochum. According to current plans. Which can change.

In German auto industry circles, there was a saying: “Wenn man nicht mehr weiter weiss, gruendet man nen Arbeitskreis.” („If you don’t know what to do, launch a working group.”) It’s good to hear that this venerable philosophy is still being practiced at Opel.

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Opel Prolongs The Pain: No Layoffs Or Plant Closures Through 2016 Sun, 28 Oct 2012 11:06:58 +0000

Unions reached a last minute deal with Opel:  Plant closures and layoffs are off the table through 2016. This according to information given by works council chief Walter Einenkel to the usually reliable Westdeutsche Allgemeine Zeitung.

The deal needs to be approved by union members. A meeting has been called for today.  There is no official statement by Opel or the unions.

Should the report be confirmed, then GM would do just the opposite of Ford. Ford announced the closure of three European plants last week, a painful and costly cut  which promises to bring Ford Europe back into the black by 2015. GM on the other hand tied its hands through the end of 2016. Layoffs and plant closures would only be possible in 2017, guaranteeing losses in Europe for most if not all of the decade.

Opel owed its German workers some $15 million due to a 4.3 percent payhike negotiated for all IG Metall workers in May.  Opel had until the end of October to either cut a deal or to pay the deferred raise in one lump sum. Opel must be pretty desperate to trade away its freedom of action for what amounts to pocket change.

In May it was decided to move production of the Opel Astra to Opel’s UK plant in Ellesmere Port by 2013. It was expected that the Bochum plant would be shuttered by the end of 2014 when a previous agreement with the unions will ran out. Under the new agreement, the agony will be prolonged by another two years.

Reuters confirmed the report, with qualifications. According to Reuters, Opel and the unions agreed to keep the plants open until 2016, and to continue discussions about a restructuring of Opel. However, the agreement can be terminated depending on the outcome of the discussions. The deferred raise of 4.3 percent will be paid in November with a lump sum payment. After that, the salary raise will be deferred again. According to Reuters, the Bochum plant cannot be closed before 2016 anyway. Production of the current Opel Zafira is scheduled to end in 2016.

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Opel Fix Will Cost More Time And Money Than Anyone Expected Mon, 18 Jun 2012 11:46:52 +0000 Last Saturday, Opel CEO Karl-Friedrich Stracke wanted to address the workers at Opel’s Bochum plant. All he addressed was 2,000 backs as the workers got up and left.

What triggered the row was Stracke’s unwillingness to commit to Bochum’s future beyond 2016. Last week, GM started to negotiate Bochum’s closure with the German metal workers union IG Metall. GM offered to keep Bochum open until the end of 2016, that’s two years longer than GM’s contract with the unions requires. In return, GM wanted salary concessions from its workers, Reuters says.

Bochum workers say no deal. “We won’t pay for our own funeral,” Opel shop steward Rainer Weinmann told N-TV.  When Stracke didn’t offer something better, the workers walked.

Meanwhile GM told Opel works council chief Rainer Einenkel that €500 million ($633 million) have been earmarked for Bochum’s closure. Einenkel says twice as much will be about right. “Includingh restructuring costs, about a billion Euro will be about right,” Einenkel told Germanys’ WAZ,

One of the reasons for GM’s stock being way down is the bleak outlook for its European operations. Massive firings can become a very costly exercise in Germany – unless the company goes bankrupt. It looks as if a solution to GM’s hemorrhaging will cost more time and more money than anyone expected. As things stand, losses for the next five years are pretty much a given. Unless …

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Asked Whether He Will Close Bochum Plant, Opel Chief Says He Hasn’t Decided Yet Mon, 21 May 2012 11:12:01 +0000

Opel chief Karl-Friedrich Stracke was asked to tell his workers unambiguously whether the Opel plant in Bochum will be closed or remain open. Today, Stracke met with workers in Bochum. He told them that no decision has been made – yet.

The meeting took place after state premier Hannelore Kraft had called on Stracke “to make a clear statement on his plans,” says Reuters. Pressured by Detroit to stem the bloodletting of Opel, and pressured by Northrhine-Westfalia’s highly popular premier, Stracke took the easy way out.

He said that he would stick to the contracts that forbid plant closures or firing through 2014. However, “in the long term, the company has to be put on a solid footing,” Die Welt paraphrased Stracke.

Ever since GM decided to move future Astra production the Ellesmere Port, the Bochum plant is said to be the first GM will close once it can. Maybe workers will receive an answer on June 28. This is when Stracke will present a business-plan to Opel’s supervisory board.


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Official: GM Lets Ellesmere Port Live. Bochum Likely To Die Thu, 17 May 2012 10:48:12 +0000 What was highly probable yesterday is definite: GM will shift production of the Astra compact from Germany to Ellesmere Port, England. Workers at the UK plant agreed nearly to a man and a woman (approval rate 94 percent) to a deal with GM that keeps Ellesmere Port open and that spells the near certain doom of Opel’s plant in Bochum.

Workers agreed to a four-year deal that freezes wages for two years, and that allows only moderate rises of around 3 percent for the following two years, Reuters heard from a source. The source also said:

“It’s almost certain that one of GM’s German plants will now be closed, probably the plant in Bochum.”

Currently, some Astra production is at Opel’s Rüsselsheim plant in Germany. Beginning in 2015, this will shift to Ellesmere Port. The Polish plant in Gliwice most likely will continue Astra production. It is expected that production of other cars will be shifted from Bochum to Rüsselsheim, with Bochum to be shuttered.

According to a GM statement, the Ellesmere Port plant will run three-shifts at full capacity. GM committed to a minimum of 160,000 vehicles to be produced each year. The company will invest £125 million into the facility and expects to create circa 700 new direct jobs. The agreement comes into force in 2013 and runs through the life of the next-generation Astra, into the early 2020s. Production of the new Astra will begin in 2015. This is also when the current contracts with European unions run out. Until then, all plants must stay open, and all workers must remain working.

Ellesmere Port had been on GM’s target list, but survived again. This also means a continuation revival of the British car industry, this time with a British brand on German cars. Lately, the island has been a preferred location for production by Asian manufacturers, such as Nissan, Toyota, and Tata. Britain now exports more cars than it imports for the first time since 1976.


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Decision Close: Opel Will Close Bochum, Keep Ellesmere Port Open Wed, 16 May 2012 20:50:42 +0000 Tomorrow, Thursday morning, GM will most likely announce that the new Opel Astra will be built at the Ellesmere Port plant near Liverpool, and no longer in Germany. This ends weeks of hard-nosed gamesmanship, where one plant was played against the other.

According to a report in the London Telegraph, workers at the Vauxhall plant voted on Wednesday on concessions. The results of the ballot are not announced yet, but British media treats it as a done deal.

 Reuters says that Opel presented a catalogue of demands “including wage cuts, more temporary workers and outsourcing.”

The Daily Mail already seems to know that “Ellesmere Port and Gliwice in Poland will now become the only two manufacturing centres of the next generation Vauxhall Astra which hits showrooms from 2015.” The paper also is certain that “Opel’s Bochum plant in Germany, which builds the Zafira, is set for closure.”

A Daily Mail source opined that “The German unions will go bonkers.”

The source is probably right. The German Metal Worker union demands pay hikes from all automakers. There already were widespread warning strikes at Audi, BMW, Daimler and parts suppliers. GM and Opel are contractually precluded from closing any Opel plants in Europe through 2014. Jobs are likewise secure. Once plant closures are announced, it will be very tough working with the doomed workforce.


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How To Get Rich Quick: Lose Your Job At Opel, Collect $360,000 Wed, 01 Jun 2011 11:37:27 +0000

After tedious negotiations, and only after an arbitrator was brought in, GM’s Opel finally has a deal for its Bochum plant in Germany. As planned, 1,800 jobs will be cut. The deal will cost GM dearly.

According to Automobilwoche [sub], workers who leave will receive golden parachutes of up to $360,000 a head. You did read right. 300 workers will get a job in Rüsselsheim, and up to $36,000 for being inconvenienced by a move 150 miles south.

If workers hurry and leave, or decide to go south, before June 15 comes around, they can pocket another inducement to the tune of up to 5 months salaries. Ka-ching!




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