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Opel Targets German Plants to Cut 4,100 Jobs and Revamp Business

Oliver Sachgau
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Opel Targets German Plants to Cut 4,100 Jobs and Revamp Business

(Bloomberg) -- PSA Group’s German car-making division Opel will cut up to 4,100 jobs, joining rivals around the globe in retrenching amid a sales slowdown and technological disruption.

The cuts will be focused at German sites in Ruesselsheim, Eisenach and Kaiserslautern, where Opel will reopen a voluntary leave program for employees to eliminate 2,100 positions by 2025, the company said in a statement Tuesday.

Additionally, the carmaker agreed with labor representatives to have the option to cut another 2,000 positions in two tranches in the coming years, a spokesman said.

“This agreement creates a further considerable improvement of our competitiveness,” Opel Chief Executive Officer Michael Lohscheller said in the statement. The company will also invest more money into the Rüsselsheim plant.

Opel’s workforce stands at roughly 30,000 employees, including more than 16,000 in Germany. PSA shares declined as much as 1.3% and were down 0.2% at 1:29 p.m. in Paris.

While PSA breathed life into Opel after acquiring the company from General Motors Co. in 2017, German brands have been struggling to prove they’re ready to meet stricter emissions standards, which are almost impossible to meet without electric cars. Transitioning from the internal combustion engine that Germany invented could be taxing for its economy because plug-in cars require fewer parts and less labor to build.

Carmakers are eliminating more than 80,000 jobs during the coming years, according to data Bloomberg News compiled in December. PSA announced plans late last year to merge with Italian-American automaker Fiat Chrysler Automobiles NV and has said no plants will close as a result of the deal.

(Updates with announcement from Opel in second paragraph.)

--With assistance from Ania Nussbaum.

To contact the reporter on this story: Oliver Sachgau in Munich at osachgau@bloomberg.net

To contact the editors responsible for this story: Tara Patel at tpatel2@bloomberg.net, Chris Reiter

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