Not A Good Day To Be A Troll

[Perian]

GM Chooses German Plant for Midsize Cars

Friday March 4, 5:47 am ET
By Melissa Eddy, Associated Press Writer
German Plant Beats Out Sweden As Center for GM's Midsize European Cars

FRANKFURT, Germany (AP) -- General Motors Corp. on Friday chose its Ruesselsheim, Germany plant to build midsize cars for Europe over a plant in Sweden as the automaker strives to cut costs and head off bruising competition.

The automaker had said that only one of its European plants would produce the next generation of midsize Opels and Saabs, currently made at both Ruesselsheim and the Saab plant in Trollhaettan, Sweden.

GM said it based the decision on factors including labor costs, plant efficiency, logistics and currency issues.

"The study revealed that the best business case for this product allocation is the Ruesselsheim plant, which will be able to substantially improve its productivity," GM's European subsidiary, Adam Opel AG, said in a statement.

"Both facilities put their best foot forward," said Fritz Henderson, chairman of GM Europe. "The business case over time for the Ruesselsheim facility was approximately 200 million euros (US$262 million) more cost effective than that of the Trollhaettan facility."

Ruesselsheim is GM's biggest plant in Europe, with some 20,000 workers. The company has said it plans to cut 2,700 jobs from the plant as part of restructuring its European operations.

Details of a long-sought deal with workers at the plant, including a wage freeze and reducing benefits, were expected to be announced later Friday.

GM has said it has to reduce costs at its money-losing European operations -- Opel, Saab and Vauxhall -- to cope with sluggish consumer demand and increased competition from Japanese and other carmakers.

GM Europe announced last year that it would cut as many as 12,000 jobs in Europe. GM said 15 percent of management jobs in Europe would be eliminated as part of the program, which aims to produce cost savings of $665 million a year.

For years, General Motors let its regional divisions design and build cars independently. Now, the company is seeking more shared development and parts.

The mid-size Epsilon platform, to be built at Ruesselsheim from 2008, can serve as the basis for either an Opel Vectra or a Saab 9-3.

GM said it was still committed to production at Trollhaettan. In addition to a new mid-sized Cadillac built for the European market, the company also plans to keep producing other Saab models at the plant at least through 2010 and would expand the Saab line to include an unspecified new "crossover" vehicle.

"Furthermore, we will make every attempt to allocate additional future products to this facility," said Carl-Peter Forster, president of GM Europe.

Of Trollhaettan's 53,000 residents, nearly 6,000 work for Saab.

[cyboexpo2002]

The Troll will be dead after 2010

[tgagneguam]

Something's gotta be done about excess capacity. The global vehicle market is a bit north of 60 million unts per year, yet the automakers have a combined capacity of nearly 80 million vehicles. That's excess anyway you slice that pie.

[mgescuro]

Well, Trollhattan is hardly "dead." It just puts it's future in jeopardy. Just remember, the 9-5 is also made in Trollhattan. So unless 9-5 becomes an Epsilon II (not likely), it still has to be made in Sweden. And of course, there's the new SUV that is coming.

Whatever platform the new 9-5 and 9-SUV will be... it "could" be made in Trollhattan.

But... I'm still saddened by the loss of Trollhattan. But I expected it. I don't beleive labor and efficiency played that large a part. I think the fact htat Sweden isn't part of the Euro Zone is what doomed it.

[Perian]

Originally Posted by mgescuro

I don't beleive labor and efficiency played that large a part. I think the fact that Sweden isn't part of the Euro Zone is what doomed it.

Excellent point - you are correct. No pun intended from this Saab owner, but you pay a high price for the "State of Independence". It is a sad day.

[Globalist]

I don't think it's Euro zone issue.
The problem with Europe is that it has been a convalesent economy in the last few years, and as Tgag mentioned overcapacity is huge. Also the cost of doing business there is high, and unless you are in a high=margin segment like BMW, Daimler, or Porshe, all other players (entry and mid-level products) will continue to suffer until the economy starts growing.

In the meantime, I think it's wise to keep Troll for Saab and Cadillac if there is any help from swede govt, and move mid-size vehicles to Germany as an incentive to get more concessions from German labor, hoping that natural growth will happen as the economy improves. Otherwise, it's just moving the timing of the same problem to the next few years.

[syr74]

If GM keeps this up they will be lucky to be able to sell cars to old Saab loyalists or Swedes at all. GM would have been far, far better off to have never purchased Saab at this point. They apparently have no idea how to run the little company and have almost certainly done themselves more harm than good while at the helm. However, Volvo and Ford are almost certainly happy to absorb the defectors.

[TurboSAAB]

Originally Posted by mgescuro

Well, Trollhattan is hardly "dead." It just puts it's future in jeopardy. Just remember, the 9-5 is also made in Trollhattan. So unless 9-5 becomes an Epsilon II (not likely), it still has to be made in Sweden. And of course, there's the new SUV that is coming.



the 9-5 and 9-3 will share epsilon 2 and also both become a little bigger.

Whatever platform the new 9-5 and 9-SUV will be... it "could" be made in Trollhattan.


Germany on this one it seems like


But... I'm still saddened by the loss of Trollhattan. But I expected it. I don't beleive labor and efficiency played that large a part. I think the fact htat Sweden isn't part of the Euro Zone is what doomed it.

I am more perterbed by the fact that the SAAB design team is leaving sweden

[yoblues]

The worst possible thing that could have happened to SAAB is to have Rickey Waggyboy and his GM MORONS buy the company. GM can't figure out how to sell Buick's and Pontiac's never mind Saab's. Keep your fingers crossed that GM sells Saab before it becomes Oldsmobile. Either that or combine Saab, Opel, Vauxall and Saturn and call it Saab since Saab is a worldwide brand. That could consolidate design and engineering of four lines into one. That would be the best move but we are dealing with GM suits, the most unimaginative people on the planet Earth.

[cyboexpo2002]

Originally Posted by Mags

In the January Motor Trend, didn't Lutz say that manufacturing in Germany was too expensive?

MF

Yeah, but the German unions are a nasty breed, and supposedly GM didn't want to piss them off any more after all of that restructuring Opel is already doing...