FRANKFURT AM MAIN: German carmaker Opel on Friday said it has struck an agreement with union leaders to cut labour costs by reducing working hours and offering early retirement as part of a major push to return to profit.
The deal comes as Opel's new French owner, PSA, seeks to eke out 1.1 billion euros ($1.3 billion) in savings by 2020, without resorting to plant closures or forced redundancies at the loss-plagued German automaker.
"It is our joint goal to make Opel competitive again," Opel chief executive Michael Lohscheller said after weeks of negotiations with the powerful IG Metall union.
The agreement includes plans to shorten the working week from 40 to 35 hours for certain employees, and offer more opportunities for early retirement and shorter hours for older workers.
To further cut costs and reduce overlap with the parent company, the purchasing departments of Opel and PSA will be combined.
"In the long term, 30 percent of the total synergies from the integration of Opel/Vauxhall into Groupe PSA will be created in purchasing," according to the statement.
Managers' bonuses will be tied to the success of the turnaround plan, Opel added.
Ruesselsheim-based Opel did not say how many employees would be affected by the new measures.
The lightning-logo carmaker -- which has not booked a profit since 1999 -- employs some 38,000 people in Europe, around half of them in Germany.
Industry expert Ferdinand Dudenhoeffer, director of Germany's CAR research centre, has estimated that Opel will need to shed some 6,000 jobs under the ambitious restructuring.
Peugeot and Citroen owner PSA took over Opel and its British sister brand Vauxhall from US giant General Motors in August for 1.3 billion euros.
As part of its efforts to drive Opel out of the red by 2020, PSA has already announced 400 job cuts through voluntary redundancies at Vauxhall's Ellesmere Port plant in England.
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