Tags: Opel | workers | pay | freeze

Opel Workers Agree to Pay Freeze Through 2015 to Restore Profit

Friday, 15 Mar 2013 10:27 AM

General Motors Co. won worker approval at three of its Opel brand’s factories in Germany to freeze wages through 2015 amid a bid by the carmaker and competitors in Europe to restore profit in a shrinking market.

Employees at plants in Ruesselsheim, Kaiserslautern and Dudenhofen voted with majorities exceeding 83 percent to accept a reorganization agreement reached with labor leaders in February, the IG Metall union said today in a statement. Workers in Eisenach will vote in the coming days, while negotiations at the plant in Bochum, where vehicle production is scheduled to end in 2016, are continuing, it said.

“A negative vote, or a lack of a resolution in Bochum, doesn’t mean that the contract can’t be implemented at the other sites,” IG Metall district leader Armin Schild said in the statement.

Industrywide European car sales are set to fall a sixth consecutive year in 2013 after reaching a 17-year low in 2012, and manufacturers are responding by cutting jobs and closing plants. GM Europe, which includes Ruesselsheim-based Opel and Luton, England-based Vauxhall, has lost $18 billion since 1999, including a $1.8 billion deficit last year.

Ford Motor Co. lost $1.5 billion in Europe in 2012. Unions at its plant in Genk, Belgium, are scheduled later today to announce the result of a vote on severance packages when the factory shuts in 2014. Renault SA, France’s second-biggest auto manufacturer, agreed with labor leaders on March 13 on cutting its domestic workforce by 17 percent and freezing pay in exchange for a pledge not to close plants for three years.

New Models

GM Europe has a target of improving earnings this year, helped by new models such as the Mokka compact sport-utility vehicle and Adam city car, and aims to break even by 2015. Opel, led by former Volkswagen AG manager Karl-Thomas Neumann since the beginning of this month, is refraining from forced job cuts for the more than 20,000 employees in Germany in exchange for the pay freeze.

The brand has laid out plans to convert the Bochum plant into making components and maintain a logistics center to secure 1,200 of the more than 3,000 jobs at the site. Rainer Einenkel, head of the plant’s works council, said on March 1 that he didn’t support the broader labor agreement with Opel management.

Steve Girsky, the GM vice chairman who ran the carmaker’s European operations until Neumann succeeded him, threatened in January to close the Bochum assembly plant by the beginning of 2015 if the Opel employees didn’t agree to concessions. Girsky has said repeatedly that Detroit-based GM supports Opel’s turnaround plan.

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