General Motors may bundle its European operations in a new company based in Brussels in a move to cut costs and simplify management structures, a German newspaper reported on Saturday.
Welt am Sonntag cited the chief employee representative at Adam Opel AG, the German unit of the world's biggest carmaker, as saying he was in talks with executives at GM's European headquarters in Zurich and Detroit head office about the plans.
Klaus Franz said GM was looking at setting up a "European Company", taking advantage of a recently enacted EU statute that allows firms operating in more than one EU member state to have one set of rules and a unified management and reporting system.
"The new legal form would allow GM to dispense with its current complex structures in Europe. It would save the company money," Franz was quoted as saying.
GM Europe officials could not be reached for comment.
GM Europe, which has 11 production and assembly plants in 8 European countries, wants to save 500 million euros ($631.6 million) a year to halt losses and has said 12,000 jobs - or about a fifth of its workforce - may go in the next 2 years.
Germany is likely to bear the brunt of the layoffs.
Franz said the proposed structure, which would see Opel and Sweden's Saab reduced to brands, could also have benefits for employees by giving them a seat at the top table, rather than negotiating with local managers.
"We would be able to negotiate current issues and problems directly with the European management, where all the decisions would be taken," he was quoted as saying.
Belgium is one of only six EU states to have implemented the European Company regulations at national level. Should GM Europe proceed with the plan, about 130 head office staff would be moved from Zurich, the newspaper said.
GM Europe Chairman Fritz Henderson would head the new company, with current GM Europe President Carl-Peter Forster continuing to act as his deputy, it added. Opel Chief Executive Hans Demant would become Vice-President Engineering.
GM and employee representatives will meet at least twice next week to discuss the cost savings programme, IG Metall metalworkers union official Willi Groeber said on Friday.
Workers continue to demand pledges from GM that it will not resort to forced layoffs or plant closures to reach its savings target in Europe, where it has not made a profit since 1999.
GM has refused so far to make such promises, but has said it may be possible to attain its goal without shutting any plants.
Franz told Welt am Sonntag that talks with GM Europe management were making progress and that it wasn't unrealistic to expect that forced layoffs and closures could be avoided.
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