GM Europe managers and labour officials agreed a deal on sweeping cost cuts at the carmaker's loss-making European business ahead of a GM board meeting on Tuesday afternoon, sources have told Reuters.

Reuters also reported that GM Europe President Carl-Peter Forster said that GM wanted to save "at least" 500 million euros in annual fixed costs and the actual number could be much higher.

The report said that he told a Handelsblatt auto industry conference on Tuesday that the 500 million figure to be cut over the next two years was what the carmaker was sure to save. "We clearly want to save more," he added.

Meanwhile, some confusion has resulted today (Wednesday) from comments attributed to a GM Europe workers' forum representative and reported by the Associated Press news agency.

Klaus Franz appeared to imply that the deal approved at the GM board meeting means that there will be no European plant closure or forced layoffs.

"The major point of the agreement is the declared intention of both sides to avoid forced layoffs and plant closures," Franz said in a statement carried by AP.

Specific restructuring measures will be negotiated in each country where the US-based auto giant's European arm has factories, and both sides agreed to boost the group's European earnings by increasing marketing and sales activities, he said, according to AP.

It was unclear how that squares with GM's plans to slash up to 12,000 jobs in the next two years in Europe, mostly in Germany, to cut excess capacity.

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