Opel, Union Reach Deal on Future of German Plants

VIENNA – Adam Opel will keep producing cars at its Bochum, Germany, plant through 2016 and is promising new product for its Kaiserslautern, Russelsheim and Eisenach, Germany, operations as part of a deal reached today with its labor union.

The framework, dubbed Deutschlandplan, or Germany-wide plan, was stitched together by Opel management, the IG Metall union and the Opel works council.

“General Motors fully supports Opel and is securing the necessary financing for the coming years, until we once again return to profitability,” GM’s Vice Chairman and Opel Supervisory Board Chairman Steve Girsky says in a statement announcing the agreement.

In return for the new-product promises, scheduled pay increases will be deferred and salary components above the general pay scale – such as Christmas bonuses – will be suspended.

The main issue of contention between management and labor was the future of the Bochum plant. Last October, Opel said it would phase out car production there in 2016, but later suggested the shutdown could be moved up.

With the new arrangement, Opel will keep the facility in operation until the end of 2016, when it expects to end production of the current Opel/Vauxhall Zafira Tourer multipurpose vehicle.

Currently, Bochum also builds the previous-generation Zafira Family and makes the previous-generation Astra III, dubbed the Astra Classic, in small volumes.

Some jobs will be eliminated sooner at the plant, which will go from a 3- to 2-shift operation in the second quarter. Opel is offering severance packages and partial retirement programs for the 700 employees affected by the move.

Production of the F13 transmission manufactured in Bochum, will continue, not cease at the end of the year as had been planned.

“Opel wants to stay in Bochum,” Girsky says. “We want to keep our warehouse in Bochum. We want to secure a total of around 1,200…Opel jobs in Bochum – and convert the location into a components plant.”

Some 600 jobs will remain in the warehouse operation, Opel says, with about 600 more to be retained in still-undetermined component production. Currently, Bochum employs about 3,300 workers.

Opel, through its Bochum Perspective 2022, also is collaborating with government, academia, labor and industry to lure new companies and technologies to the city and surrounding region.

Today’s deal with IG Metall also calls for Opel to produce two models after 2015 at the Eisenach plant, which now manufactures the Corsa and Adam small cars.

The future of the Kaiserslautern components plant also is secured beyond 2016, with Opel planning to maintain employment there at about 1,800 people.

The main Russelsheim factory will produce a second model after 2015. Today, the operation is the sole source for Opel’s flagship Insignia. It also builds the Astra.

The next-generation Insignia also will be sourced exclusively in Russelsheim, as will F40 transmissions.

Russelsheim’s product-development center will remain an integral part of the international GM development group, the auto maker says.

But the company still is working on a strategy for its manufacturing engineering operations, which it expects to deliver in June.

“Today is a good day for Opel and a good day for GM. Opel is and remains a key part of our global GM business,” Girsky says. “This Deutschlandplan is an important milestone for Opel to return to profitability by the middle of the decade. We will get our costs under control with it.”