2 German Opel plants put workers on reduced hours

[August 24, 2012]  BERLIN (AP) -- General Motors Co.'s Opel unit says employees at two of its German plants will work reduced hours over the next few months as the company struggles with a sagging European car market.

Opel said Thursday it agreed with its employee council and the IG Metall industrial union that workers at the Ruesselsheim plant and the Kaiserslautern components factory will work reduced hours on 20 days through the end of the year.

Opel board member Holger Kimmes said that the company until recently was able to compensate for decreased production through measures such as accounting for accrued overtime hours.

The government-subsidized short-time work program, which allows employers to reduce production without cutting their workforce, was credited with keeping down German unemployment during the 2008-9 financial crisis.

The move to shorter hours "will safeguard jobs," top employee representative Wolfgang Schaefer-Klug said in a statement.

GM has vowed to turn around its lossmaking European operations, where it lost $747 million last year and $256 million in the first quarter. Yet labor agreements restrict its ability to lay people off or quickly close less efficient plants. Opel CEO Karl-Friedrich Stracke and several other top Opel managers stepped down July 12 shortly after presenting a turnaround plan involving new models and developing sales in emerging markets.

The short hours plan affects manufacturing and administrative workers but not those in engineering. The Ruesselsheim facility has 13,800 workers, about half of whom will be affected by the short hours. The Kaiserslautern plant has a workforce of 2,500.

[Associated Press]

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.