General Motors and European subsidiary Opel are in talks with German labor union IG Metall about the future of the parties’ working relationship. The parties have already gone on record in giving each other just over four moths to restructure their labor agreement, with a definitive plan due by November of this year. However, several details have recently emerged in the negotiations process that shed light on the development.
First is the topic of extending the exclusion of compulsory separations until the end of 2016 — a year after Opel’s Bochum plant is widely expected to close following the end of production of the Zafira. In exchange for the delay, the union would delay the implementation of the 2012 tariff agreement (wage increase). As expected, the talks include a solution to keep the Bochum plant open and operations until the end of 2015.
Secondly is the topic of utilizing the Rüsselsheim, Eisenach, and Kaiserslautern plants and — in lieu of anticipated future demand — Opel management will not allocate further product to Bochum after the run-out of the current Zafira.
The parties will continue their talks over the following weeks to negotiate a comprehensive agreement, with the stated goal of not only reducing costs, but also reducing “the dependence from importing cars and components”, as per Opel. This solution, thirdly, “could also include the production of non-Opel vehicles in European plants.”
The GM Authority Take
Overcapacity is a real problem in Europe. But if this newfound information tells us anything, it’s to not rule out the possibility of producing “non-Opel” vehicles at Opel plants.
For its part, the Opel supervisory board will vote on Opel’s ten-step plan to return to profitability on June 28. As it stands, that plan also includes a “New Brand Strategy” that would involve Opel/Vauxhall reaching “traditional and attainable potential customers”. In other words, don’t discount Opel’s move upmarket just yet.