GM to shut down Opel factory in Belgium, and announces more job cuts

The plant in Antwerp, Belgium, which employs 2,600 workers and builds Opel and Vauxhall cars for Europe, will be shut down by GM over the next few months. The announcement comes after GM announced that it will wind down its Swedish brand Saab.

"We fully understand the effect this announcement has on the Antwerp employees and their families and we sympathise with them," said Opel CEO Nick Reilly adding that, "we must make this announcement now so that we can secure a viable future for the entire Opel and Vauxhall operations."

GM said that the global economic crisis has severely affected the Western European car market, and it expects sales in 2010 to be down by 1.5 million over 2009, and down by almost 4 million from its peak in 2007.

"It is not expected to return anytime soon - if ever - to these peak levels, resulting in significant overcapacity in general and at Opel in particular. To ensure long-term sustainability for the company, Opel needs to reduce capacity by approximately 20 percent," GM said in a prepared statement.

While GM said it has no plans to shut down any other factory other than the Antwerp plant, it warned that there will be capacity reductions, job redundancies and/or labour cost reductions. According to media reports, GM could slash up to 8,300 jobs from Opel/Vauxhall’s 50,000 strong workforce.