GM Shutting Down European Plants


Western European workers at General Motors are putting pressure on the US carmaker over its threat to shut an assembly plant in Portugal. Plant workers are protesting by walking off the job or laying down their tools for periods. This is a response to GMs decision to close the Portuguese plant; workers also fear that GM is seeking more cutbacks across western Europe.

GM recently broke ground at a major new production site outside St.Petersburg in Russia, and is in talks about opening a joint-venture facility near Warsaw in Poland. It has said that it costs 500 euros ($342) more per vehicle to produce its Combo delivery vans in Portugal than at other potential manufacturing sites.

Last week it told the 1,100 Azambuja workers that production would be shifted to Zaragoza in Spain, but has now deferred the decision for five weeks after the Portuguese government stepped in. GM Europe is in the process of cutting about 12,000 jobs as it looks to reduce costs in a region where it last made an annual profit in 1999.

The company is also engaged in a series of large-scale job cuts in the United States, in attempt to regain profitability in the face of increasing competition from Japanese carmarkers. Fact of the matter is, GM can’t compete cause they can’t innovate, they’ll keep on cutting going to the lower cost labor market but they need a better design or something to cut costs. All around, the company needs to be more efficient, easier said than done.

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