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FRANKFURT (Reuters) - Opel, the European arm of General Motors, has reached a severance deal with workers at its Bochum factory in Germany, it said on Monday, a crucial step in the automaker's restructuring.
Opel management has been negotiating with labor union IG Metall about the terms of a severance deal after it decided to close the Bochum factory in April last year, as part of a drive to bring down costs in Europe.
Opel has reached "binding and reliable" agreements with IG Metall, the Ruesselsheim-based carmaker said in a statement. Opel declined to comment on the cost of laying off the staff.
The closure of Bochum is set to cost at least 550 million euros ($754 million), two sources familiar with the matter told Reuters in May.
Opel expects its results this year to be burdened by non-recurring costs such as unfavorable exchange rate moves as well as the closure of the Bochum factory.
In early June, General Motors said it expected to report a profit in Europe by mid-decade. Previously, it had only said it would break even in Europe within that time frame.
Reporting by Edward Taylor and Jan Schwartz; Editing by Mark Potter