March 23, 2012 / 12:06 PM / 6 years ago

Opel labor urges management to return to talks

FRANKFURT (Reuters) - Labor leaders at Opel, General Motors’ (GM.N) loss-making European unit, on Friday urged management to return to the negotiating table and thrash out a compromise before a board meeting next week that could otherwise result in a move to close two vehicle plants.

A General Motors logo is seen on a Denali vehicle for sale at the GM dealership in Carlsbad, California January 4, 2012. REUTERS/Mike Blake

Management will on Wednesday present Opel’s supervisory board with a mid-term business plan that currently foresees the closure of two plants, according to labor sources. Unions would vote against any plan to approve closures put to the board, which could threaten talks over a restructuring of the business.

Labor leaders said management should “clearly reject the public speculation (over plant closures) and agree to hold immediate constructive internal talks in order to prevent further damage to Opel/Vauxhall”.

The GM unit currently has excess annual capacity equivalent to some 500,000 vehicles, or about two plants, company sources say, and management is planning to cut as much as another 30 percent of its fixed costs after already lopping off 20 percent in 2010, when it closed Antwerp.

Union officials criticized GM for considering such drastic measures, and called for the company to adopt the approach used by some rivals that have brought production back from abroad to Europe or begun to source more components internally.

Manufacturing vehicles in Europe instead of importing would save the expense of heavy severance packages, they said.

“Following up market share losses with cost cuts is the old crash course that General Motors has driven for the past 20 years at Opel,” IG Metall regional boss and Opel board member Armin Schild said on Friday, criticizing GM’s “unprecedented history of failure”.

“Billions wasted on personnel cuts and plant closures could actually be invested in research and development instead.”

Reporting by Christiaan Hetzner; Editing by Helen Massy-Beresford

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