General Motors Europe has announced a major restructuring plan to improve its market position and return its business to profitability, after declaring a 3rd quarter loss of $181 million.
In the manufacturing area, Vauxhall intends to undertake a major restructuring of its manufacturing operations. It has proposed that in Luton, production of the Vectra would move to one shift early in 2001, and would cease at the end of the life of the current Vectra model, which will be by the end of the first quarter of 2002.
From this point forward, the remaining Luton facilities would concentrate on commercial and offroad vehicles, while passenger car production would be concentrated at Ellesmere Port. This means that the new medium-duty van, the Vivaro, and the Frontera would be produced at Luton. Ellesmere Port will continue to produce the Astra and a study is being made to possibly incorporate the next-generation Vectra and turn the facility into a two-model flex plant.
In total, these specific actions in the UK, and those previously announced, including the ‘leanfield’ conversion of Opel’s RÃ¼sselsheim manufacturing site, will reduce GM Europe’s installed capacity by more than 400,000 units between now and 2004.
In addition, lean manufacturing implementation will be accelerated across all European plants, to obtain the productivity levels currently demonstrated at Opel’s benchmark Eisenach facility.
In the sales, marketing and administration areas, GM Europe plans to accelerate the migration of certain financial and administrative functions to the company’s European Financial Shared Services Centre in Spain.
Taken together, these various restructuring activities, as well as a number of other actions, are expected to reduce overall employment levels in Europe by more than 5,000 people within the next 18 months, consistent with GM’s objective of reducing salaried headcount by 10 percent by the end of 2001.