Closure fears hang over GM plants
Share this article:
A golden anniversary is usually cause for celebration, but at General Motors' car plants at Bochum in western Germany and Ellesmere Port in northwest England, the talk is of closure, not their openings in 1962.
Economic weakness across much of Europe has hit car sales, forcing the sector to address a capacity overhang. GM boss Dan Akerson estimates that manufacturers have 10 plants too many across the continent.
Though Opel, GM's European unit, has said none of its plants will go before the end of 2014, most expect the 50-year-old factory at Bochum and the Vauxhall plant at Ellesmere Port, the company's only remaining car plant in Britain, will be earmarked for closure.
Opel's supervisory board meets on Wednesday, and thousands of employees and thousands more who depend on the plants for at least some of their business fear their futures could be decided in the course of the discussions at the company's Russelsheim headquarters near Frankfurt.
Bochum, once home to a thriving coal and steel industry in the heart of the Ruhr basin, underwent painful restructuring as the mines shut down between 1960 and 1980. Opel's factory, built to make the Kadett coupe as a roomier alternative to the Volkswagen Beetle, was opened during the heyday of Germany's post-war economic boom.
Declining vehicle sales and cost reductions by its US parent led Opel to abandon capacity over the past two decades and confine production in Bochum to less than half the 170 hectares it owns.
Detlef Holzhauer, 61, a schoolteacher who was visiting the factory with a party of pupils on Tuesday, said: “We've been coming here since 1979.
“Back in those days, Opel had 16 000 workers here. That shows the scale of the whole demise, and we've been watching it all happening.”
10 PERCENT UNEMPLOYMENT
Opel's problems aren't the only yardstick for Bochum's decline. In 2008, phone maker Nokia closed a local facility with 2300 jobs and moved production to low-cost Romania. Unemployment in Bochum stood at 10 percent in February, compared with a national average of 7.4 percent.
Andreas Graf Praschma is a former spokesman for Opel's Bochum operations, who worked for the carmaker during major strikes in 2004 against the American owners' restructuring plans.
“You can turn off the lights in Bochum if the factory is shut down,” he said.
Opel suppliers such as Ernst Doeren, which packages tyres for the GM division and other carmakers, and Johnson Controls, a local unit of the US seatings maker, said their business would suffer if GM were to close down the Opel plant.
Ernst Ulrich Doeren, managing partner of the Bochum-based supplier, said: “Opel is the pulse generator for the local economy.”
“Thousands of jobs would be lost at one stroke.”
It would be at least 20 000, according to Joerg Linden, spokesman for the Bochum-based IHK chambers of commerce, including the 3100 at the plant itself, and the rest at suppliers, transporters and retailers.
Opel workers, who have contributed €265 million (R2.8 billion) a year in wage concessions to restructuring efforts, expect the golden anniversary to be Bochum's last hurrah.
A former painter at Opel, who now works for an outplacement company on the Bochum site, said: “I expect the plant to be shut down in 2015.
“We got no pay increase whatsoever for 10 years, and now this.”
Another worker who arranges parts in production and drives a forklift truck, added: “All those sacrifices on wages have been for nothing.
POLITICS OF CLOSURE
The Ellesmere Port plant in northwest England employs about 2800, including 700 contractors, all waiting to know if the next-generation Astra, due to start production in about 2015, will be built there.
The town, a 20-minute drive south of Liverpool, has a population of only 64 000. Its only other large employers are an oil refinery and a retail park. As in Germany's Ruhr, the industries of England's northwest have seen better days.
Peter Wells, head of the centre for automotive industry research at Cardiff University, said: “Ellesmere Port has been a very strong performing plant for GM, but it is not solely down to economics.
“If GM feels the need to close two plants, I think politically it would be very difficult for the company to close two plants in Germany, and that makes Ellesmere Port much more vulnerable.”
A local official for the Unite trade union, John Featherstone, said the workers were angry that their future would come down to politics.
“We're very bitter to even be considered,” he said.
“It doesn't make sense.”
That unease has spread along Vauxhall's supply chain.
A manager at one of its British-based suppliers, who asked not to be named, said: “We're feeling nervous because a lot of our products go into Ellesmere Port, and if we were to lose that contract it would have a huge impact on our business. We would have to cut staff ourselves if it goes.”
Some have seen it all before. One retired Vauxhall employee of almost 30 years' standing, whose son still works there, said threats of closure had been routine since the plant opened in Ellesmere Port: “It's been 50 years, and ever since I started there the plant has been closing,” he recalled.
“All I know is my boy tells me, 'We can't work any harder.'“ - Reuters