The Swedish car manufacturer Volvo, a subsidiary of the American Ford, announced today plans to eliminate an additional 4,000 jobs on top of the previously announced layoffs of 2,000 employees, according to Bloomberg.
CEO Stephen Odell stated that the unstable economic environment has resulted in a drastic decline in the global automotive industry. German car manufacturers Opel and BMW announced on Tuesday that they would temporarily halt production due to a drop in demand amid the crisis in international credit markets. BMW will stop production at its Leipzig plant for four days in the last week of October, resulting in a reduction of 2,800 vehicles.
Opel announced that it would halt production at nearly all of its European plants for up to three weeks, starting from October 13. Opel will stop production at its Bochum plant for two weeks, starting Monday, and at its Eisenach plant for three weeks, also starting Monday. About 6,800 workers will be affected by this move, which the company claims is part of a plan to reduce vehicle production by 40,000 by the end of this year.
Opel sold 1.74 million vehicles in Europe last year, but this year it is experiencing a dramatic decline in sales, particularly in Spain, the United Kingdom, and Germany. “The financial crisis has led to people in Europe becoming more restrained in purchasing vehicles,” said an Opel spokesperson. He added that there are no plans for job cuts, but some of the workforce will receive slightly lower wages during the production halt. The only Opel plant in Germany that will not be affected by the closure decision is the main one in Ruesselsheim, where series production of the new Insignia model is set to begin. Outside Germany, temporary closures of Opel’s plants in Poland, the United Kingdom, and Spain are planned. (Bankamagazin)
