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Auto Industry

Opel's Bochum plant not to close before 2016

Company works council officials have said that the Bochum production facility of the German carmaker Opel will not close before 2016. The struggling subsidiary of General Motors has been facing draconian cost-cutting.

Facing imminent closure, the carmaker Opel's production facility in Bochum, western Germany, was given a two-year grace period, works council officials reported Thursday.

Works council chief Wolfgang Schäfer-Klug told the DPA news agency that the struggling plant would not be closed before 2016 and that jobs in the four-digit range would be kept until then, with the factory now having a workforce of 3,300.

Schäfer-Klug said that the Bochum plant would be responsible for producing car components. He also announced that employees would be offered a two-year, fully financed retraining program once car production came to a halt.

Ambitious GM targets

Thursday's deal was the result of several months of tough negotiations between management and labor representatives. It remained unclear for the time being what employees had been willing to contribute to the agreement.

No aid for Opel from government

Opel has posted losses for year as it has experienced enormous difficulties in adapting to the sharp drop in demand for cars in the debt-stricken EU and the eurozone in particular.

General Motors, Opel's US parent company, had ordered management to prescribe draconian cost-cutting measures in a bid to force all of its European subsidiaries back on to the road to profit by 2015 at the latest.

hg/mkg (dpa, Reuters)

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