GM might close 3 of 9 European plants

Harald Hamprecht, Automotive News

RUESSELSHEIM, Germany -- General Motors Europe could close as many as three of its nine assembly plants in western Europe within five years, company sources say.

Saab's plant in Trollhattan, Sweden, is one that might close. That would end production of Saabs in Sweden.

Eric Stevens, GM Europe's head of manufacturing, is pushing for at least two plant closures, the sources say. A light-commercial-vehicle plant in Azambuja, Portugal, and one of three other assembly plants are likely to be shut, one GM insider says.

"The closure of Azambuja could be decided this summer," another company source says.

Speaking at an event in Germany this month, GM Europe President Carl-Peter Forster acknowledged that the company may close as many as three plants. But he added, "That is an extreme scenario that we don't see as probable."

Azambuja is a 33-year-old factory that produces one light commercial vehicle -- the Combo van. The Combo may be transferred to GM's plant in Zaragoza, Spain, when a successor goes on sale in 2008. Azambuja employs 1150 workers.

Other plants that could be closed are in Ellesmere Port, England, and Bochum, Germany, which produce the Opel/Vauxhall Astra lower-medium car, and Saab's plant in Trollhattan.

GM already has announced that Trollhattan will lose its core product, the Saab 9-3, in 2009. The 9-3's successor will be built by Opel in Ruesselsheim.

Ellesmere Port already faces layoffs. This month Forster announced 1000 job cuts at the plant, which currently employs 3800.

"Either a closure or a cut in Ellesmere Port seems likely," said Albrecht Denninghof, senior auto analyst at HVB Group in Munich. "Ford and PSA (Peugeot-Citroen) have already moved out of the UK, and the currency problem with the pound makes shutting the factory logical."

GM's Bochum factory is the smallest Astra plant, with annual production of just 71 300 units in 2005.

From Automotive News (a Crain publication)