GM May Move Cruze Small-Car Production to Europe

General Motors Co. will stop producing its Chevrolet Cruze compact sedan in South Korea by 2015 as part of a global restructuring of its factory capacity.

GM did not disclose where Korea's current 150,000 units of Cruze production would move when the next-generation model debuts in late 2014. But Korean union leaders say the company told them the new model will be built in five regions, including China, Europe and the U.S.

The decision has sparked speculation that GM will shift Cruze production to its Opel unit in Europe, where underutilized factories have contributed to huge losses. Opel's turnaround plan includes building more cars for export markets.

GM produces the current Cruze in mass-market volume at factories in Brazil, China, Korea and Ohio.

In response to earlier rumors, Korean unions in May threatened "war" if their work was moved to Europe. GM Korea assured workers then that the company had no such plan.

The company now says the Korean unit will focus on engineering and building minivehicles.