Opel could close half of its German plants: union chief

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US auto giant General Motors could close two of its four Opel plants in Germany if Berlin refuses to provide state aid asked for months ago, union leader Klaus Franz warned on Wednesday.

"If it is rejected, General Motors could restructure on its own terms: We would then have to fear the closure of at least two Opel German factories," Franz, head of the Opel works council, said in a statement.

Opel, which includes Vauxhall in Britain, employs around 25,000 people -- half the European total -- at four plants in Germany.

An Opel spokesman told AFP it was "confident of obtaining guarantees" from Berlin for loans and "currently has no other plan" than one submitted to European governments that foresees 8,000 job cuts from a total of 50,000.

The troubled automaker has asked European governments for 1.8 billion euros (2.2 billion dollars) in loan guarantees to underpin financing for a broad Opel restructuring programme, including one billion euros from Germany.

But Berlin has given the request a cool reception and Economy Minister Rainer Bruederle reiterated on Tuesday that he was "very sceptical."

German officials feel that GM, which emerged from bankruptcy and which posted its first quarterly profit in three years in the first three months of the year, can provide the financing itself.

Franz stressed however that the US government, which owns a majority of shares in GM, "is not ready to pay for European jobs and make US taxpayer money available for a restructuring of Opel."

Germany was ready last year to provide guarantees to Opel if GM sold it to Canadian auto parts maker Magna and Russian lender Sberbank, but GM scrapped the deal in October.

© 2010 AFP

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