PSA Groupe has been on a mission to cut costs at its newly acquired Opel and Vauxhall brands. The French automaker purchased the brands from General Motors, along with GM’s manufacturing facilities, last year for $2.6 billion. Labor leaders are now fearing the automaker is targeting mass job cuts in Germany in the pursuit of profitability.
Reuters reported on Thursday that PSA has excluded Germany from its European investment plan as Opel management seeks concessions to raise plant profitability. At the Eisenach plant, labor leaders fear PSA could cut half of the workforce.
“The current offer is for one vehicle to be produced in Eisenach which means that between 700 and 1,000 jobs will be cut back,” Wolfgang Schaefer-Klug, head of Opel’s works council, told the publication.
Labor leaders also said concessions are unthinkable as they would nullify an agreement to honor an existing collective wage bargaining agreement. Opel CEO Michael Lohscheller said management has presented an offer that’s better than the current agreement, but the goal is to keep the Opel plants competitive with existing PSA facilities.
“In part, our factories were twice as expensive as PSA factories,” he said.
Most recently, Opel announced a company-wide buyout program for all employees. Every single department will have the opportunity to take a voluntary buyout in an effort to shrink the workforce.