GM Closing/ Shunting European Plants

[ozpont]

In a sign of the times..
GM Europe and several others.. are now starting to close their car plants as the recession widens..
   This is the first time apparently since WW2 this has happenned with GM....

GM closing factory in Germany is just the beginning, experts say

Automotive News Europe | June 14, 2012 07:49 CET

FRANKFURT/PARIS (Bloomberg) -- General Motors Co., moving toward the first shuttering of a German auto factory since World War II, is only addressing a fraction of the European supply glut.

"One would need to close at least one factory per volume manufacturer in Europe, which would be about five factories in total," said Philippe Houchois, a UBS analyst in London, referring to Renault, PSA/Peugeot-Citroen, Fiat Group and Ford as the other four companies needing to shut plants.

Europe's carmakers, hamstrung by political pressure not to cut jobs, have closed just two plants in the region in the past four years: a GM facility in Brussels and a Fiat factory in Sicily.

Overcapacity in western Europe may more than double to about 2 million vehicles in 2012, according to researcher IHS Automotive. The region's car market will contract 7 percent this year, industry association ACEA said last week.

PSA shares plunged to a 23-year low Wednesday on concern about the Paris-based company's ability to reverse slumping sales, extending losses over three months to 40 percent and shriveling its market value to 2.7 billion euros.

Renault has declined 27 percent and Fiat 26 percent over the same period. Volkswagen Group, which isn't suffering from excess factory capacity, has dropped 11 percent.

Auto executives meeting in Madrid Thursday will discuss how to deal with the industry's shrinking sales, with deliveries set to drop in 2012 for a fifth straight year.

Car sales across the region plunged 7 percent in the first four months of the year, with the Italian, French and Greek markets all falling 18 percent or more, according to ACEA data. Delivery figures for May will be released Friday.
German deal

Opel is in negotiations with unions to keep the plant in Bochum, Germany, open until GM stops making the Zafira minivan at the factory at the end of 2016, the Ruesselsheim-based GM unit said Wednesday.

Opel would extend job protections by two years through 2016 and in exchange ask workers to delay wage increases set for this year