Opel’s Bochum Factory Could Close Early

General Motors Co.'s Opel unit is threatening to shutter its assembly plant in Bochum, Germany, at the end of 2014 two years ahead of schedule unless the company's German workers agree to further cost reductions by next month.

GM said last June it planned to end production at the facility, which has more than 3,000 employees, at the end of 2016.

But in a letter to employees, Opel Chairman Steve Girsky declares that Europe's "catastrophic" auto market requires labor concessions to put the unit's German operations on the road to profitability.

Girsky, who also is GM's vice chairman, says Opel must freeze wages there until it stops losing money which it aims to do by 2015. The unit is expected to lose more than $1.5 billion (€1.1 billion) this year.

Girsky notes that Opel's current labor contract protects the Bochum factory from closing only through 2014. GM has rejected a union proposal to build the next-generation Mokka subcompact there.

Girsky says Opel and its German unions must complete their long-running labor negotiations by February. The unit's management is due to present its Germany Plan to GM next month.

The IG Metall union calls GM's threat "unacceptable." The union refuses to accept a long-term wage freeze at Opel because that would create a disadvantage for the country's other manufacturers, which are bound by industrywide labor agreements that include pay increases.