A planned new small SUV will be built by GM-Daewoo (GMDAT) in a South Korea plant rather than in the Opel factory in Antwerp following today’s news the automaker is starting talks with workers and unions over closing its long-serving Belgian factory with the loss of about 2,300 jobs.
The manufacturer distanced itself from building a “small SUV” in Antwerp with Opel/Vauxhall CEO Nick Reilly announcing the Korean move today (21 January) at a press conference in Brussels, where he confirmed consultation had started on plans to close Antwerp by June or July this year.
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“The SUV situation has changed substantially since the hope to put it into the Antwerp plant,” he said at the conference attended by media from all over Europe.
“Our projections of how many SUVs have gone down – we are tooling up for that vehicle elsewhere, specifically in Korea.
“We can cope with the volume in Europe and other parts of the world from the investment we are making in Korea – it is not economic to pay twice for the tooling. The commitment to an SUV was genuine, but these plans have to change.”
Reilly declined to address specific redundancy packages for the 2,300 employees potentially about to lose their jobs, but he did confirm talks had taken place with unions in Flanders this morning. However, despite anticipating a meeting with the full European Employment Forum (EEF), the European Works Council of General Motors, the Opel/Vauxhall boss noted: “They decided not to come.”
Reilly acknowledged that, while the workforce would be “seriously disappointed,” news of the closure had been rumoured for quite some time and he did not anticipate industrial action.
“They [the workforce] will, no doubt, feel disappointed and potentially angry for a time,” he said. “We have cars for them to build and we would like them to continue normal working.”
Antwerp’s demise also comes as Opel plans a radical shake-up of its operations with unspecified and possibly swingeing cuts still to come, although no detail is yet available apart from the need to cut European capacity by 20%.
“This is a first step in an overall restructuring plan,” Reilly noted. “It is expected the full restructuring will affect all Vauxhall/Opel production sites and entities through capacity and job reductions – and through other means.
The manufacturer expects to cut around 8,300 jobs across Europe with some 4,000 posts to be axed in Germany alone.
“However, difficult the decisions we need to take, they are necessary to ensure a viable future for the company.”
Reilly confirmed plans to reduce capacity at other European sites, although he ruled out any full-scale closures. The automaker is currently in discussion with several European governments to apply for funding guarantees and is making “some quite good progress”.
“We are doing nothing different to what many, many automotive companies have done in the last 12 months, including in Japan and the US,” said Reilly. “We have significant opportunities in various countries – we are turning to those governments to look for support in some way that other companies have done.”
Only yesterday, the UK government indicated its willingness to make a “major investment” in Opel’s UK unit Vauxhall.
