General Motors V the Euro Zone crisis 0
General Motors are said to be in discussions to cut down hours in factories around Germany. A change of direction is said to be needed after the company are suffering in more losses in the Euro Zone crisis.
Plenty of General Motors jobs are under threat in Germany and throughout the European region following a real slowdown in sales. Mass car manufacturers have seen their cars taking longer to shift from showrooms in recent years. The luxury segment of the car market has in contrast thrived despite such bad economical woes.
Working days are set to be shortened at Opel plants in Germany from the beginning of September. There have been no revelations yet as to exactly what days will be shortened. The Government may offer money to compensate staff that have seen their hours cut off. Opel have said that cutting down hours is the right step forward rather than cutting jobs altogether.
This is a slight step forward in the battle between General Motors and Europe. The overcapacity problem looks to have no end at the moment. The main problem is that the cars being produced are simply more than the demand for them. Even if Opel wanted to completely shut down the factory, they are unable too. Strict Government rules state that a factory cannot be closed down or left idle. The factories to be affected by shorter working hours are those located in Rüsselsheim and Kaiserslautern.
They are two of the largest car factories in the whole of Germany. Engineering workers have luckily made the cut, with manufacturing and administrative workers under the line of fire. There are 2,500 employees currently at the Kaiserslautern factory. They will all see their hours reduced. 6,800 workers will be affected in the Russelsheim plant out of a possible 13,800.
General Motors jobs in Europe are sacrificed in the battle to keep up with competitors such as Ford and Fiat. Normal passenger car sales have been dipping over the years and are set for another great decline in 2012. To put everything into perspective, 30 of the 98 European auto assembly plants per cent of factories owned by major auto companies are operating at 70 per cent below their normal capacity. General Motors lost $361 million in the second quarter of this year within the European region. There is no real estimation as to whether the General Motors will eventually meet profit again. General Motors job losses are inevitable at this rate.