Saturday 24 February 2018

GM to shut Belgium factory after investor search fails

General Motors Co’s money-losing Opel division will shut its factory in Antwerp, Belgium, by the end of this year after failing to find a buyer.

“None of the potential investors was able to come forward with a sustainable business concept for the plant,” Opel said in an emailed statement today.

“The process to search an industrial investor interested in continuing operations has come to an end.”

The closure of the plant marks the first shutdown of a European auto factory since 2006.

While 18 assembly factories have been shuttered in the US since 2008, European governments prevented the region’s biggest automakers from firing workers and used subsidies to prop up sales.

About 1,300 people still work at the Antwerp plant, which makes the Opel Astra model, after half the workforce was eliminated earlier this year.

Opel said as recently as last month that the plant would close at the end of the year unless an investor made an acceptable bid by September 30.

Opel lost additional market share in Germany last month. The brand’s new registrations fell 19pc, compared to an 18pc drop overall, according to figures released today from the country’s Federal Motor Vehicle Office.

Opel’s share of its home market through the first nine months of the year slipped 1.2 percentage points to 7.8pc, as sales tumbled 37pc compared to the market’s 28 percent decline.

‘Death blow’

“This is the final death blow for the workers of Opel Antwerp and its suppliers,” the ACV-CSC Metea union said in a statement. “That shows in which scandalous manner GM has fooled the employees in Antwerp.”

Luc van Grinsven, the ACV union’s representative at the plant, said earlier today that a Chinese automaker and an American investor had expressed interest in buying the plant.

The last European plants to close was in 2006, when Detroit-based GM shut its site in Azambuja, Portugal, and PSA Peugeot Citroen folded its Ryton plant in Coventry, England.

“During this wind down period, while the active search of an investor for continuing activities has ended, we will remain open to discuss any reasonable proposals that might be presented to us,” Opel said today.

With GM and Chrysler Group leading the US plant closures as part of their bankruptcy reorganisations last year, improved usage is helping them post profits or pare losses.

GM, the biggest US carmaker, earned $2.4bn in the first half. Chrysler, run by Fiat SpA, reduced its losses to $369m.

Even as it’s closing the Antwerp plant, GM has promised to invest €11bn in its Opel and Vauxhall divisions to improve the model line-up and win back customers.

Opel said last month it will build a new small car at the German plant in Eisenach from 2013.

The carmaker is also ramping up component and engine production at the Kaiserslautern factory and said it will invest €500m into making engines at its site in Hungary.

Bloomberg

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