Opel unveils €11-billion restructuring plan; 8,300 jobs to go

9 Feb 2010

General Motors’ Opel division has today unveiled a five-year, €11-billion plan under which it hopes to break even by 2011 and return to profitability by 2012, although it does not believe the western European car market will come back to the levels seen earlier in this century “for quite some time”.

Opel’s CEO Nick Reilly announced details of the plan today, which he said will “reinvigorate” 80pc of its Open/Vauxhall car lines and will place strong emphasis on green products.

Job losses
The plan is based on Opel/Vauxhall reducing its capacity by about 20pc, which will result in job losses of 8,300.

These jobs losses will be spread out across most of Europe, Opel said, and will include 1,300 employees in sales and administration and 7,000 jobs in manufacturing.

Eight major launches in 2010
The plan also envisions that 80pc of the Opel/Vauxhall car lines will be at an age of three years or less by 2012. This means there will be eight major launches of car lines in 2010 alone – such as Meriva, Corsa, Movano and Astra Sports Tourer – and another four in 2011, most notably the extended-range electric vehicle Ampera, Opel said.

In addition, Opel/Vauxhall will spend €1 billion in innovative and fuel-efficient powertrain technology as it introduces a range of new green products. This includes the launch of an extended-range electric vehicle in addition to the Ampera and the introduction of pure battery-electric vehicles in smaller-size segments.

In addition, Opel also said it had accelerated its efforts introduce an entry in the sub-Corsa segment and to make a strong push in the light commercial to vehicle business. Several studies are under way to look at possible profitable export programmes in the Middle East and Asia-Pacific, it added.

A sound plan
Reilly said Opel’s external auditor Warth & Klein had judged the restructuring plan to be “sound and viable” and that following this assessment Opel had this morning formally applied for loans or loan guarantees from the German Government.

“Today’s announcement marks the beginning of a new era for Opel/Vauxhall. It is the biggest overhaul in the company’s recent history,” Reilly added.

Photo: Opel Astra

Article courtesy of Businessandleadership.com