Stracke: GM Europe Plants In Germany, England Safe Until At Least 2014
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Amid the surmounting suspicion of General Motors possibly shutting down its Ellesmere Port plant in England or the in one Bochum, Germany, GM Europe chief Karl-Friedrich Stracke has gone on record that both plants will remain open. For now, at least.
Stracke proclaimed that both plants are secure until the end of 2014. Whether these are early warning signs for plant workers to begin filling out job applications or not is beyond our immediate knowledge. But if GM Europe can find a solution to turn a profit in an overly saturated and depressed market while managing to keep both plants open, then the more power to them.
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For some reason, I think GM is using the threat of closing the plants as a tool to up their hand in negotiations to get a good labor deal with the historically rigid unions in Europe, even more so than the UAW, plus the people have widespread political support, unilike in the U.S, I honestly dont think they would close either of those factorys if they want to continue their presence in Europe. Opening a new plant is extremely expensive, which GM would have to do once the market recovers, which it will relatively quickly (within the decade). I mean who could have thought that the U.S would be buying cars at 15 million rate just two-three years after sales tanking at rates of 12 million.
I think you’re on to something. For starters, the volume will return in several years. And at that point, they will need to have the ability to keep up with demand.
In fact, earmarking a plant for closure now doesn’t make any sense, since the soonest GM could see a cost savings from closing a facility will be in 2014. By that time, the market may have rebounded!
The problem with Opel and Vauxhaul is there line up is relatively unchanged in last 10 years, we are just on “!” generation of say Corsa, Astra ect… While the Astra has changed dramatically since its last iteration it’s still relatively the same type of vehicle… Granted you could say that about Volkswagon, VW has done a More consistent job in maintaining brand strategy and customers.
Classic end of model cycle stuff. Marchione will be pleased that GM is using chapter 1 of his anti union book.
Whats not clear to me is why GM needs two factories for the identical product. GM has to start ordering tools for the next gen soon. Where that gets built could easily be a third site with Ellesmere Port and Bochum both being shut.
Which can be found in chapter 2 of Marchionne’s play book.
And they’ll lose substantial
amounts of volume when the market recovers…