German union criticizes Stellantis over use of furlough scheme at Opel plant

October 7, 2021

BERLIN (Reuters) – Workers at Opel’s Eisenach plant, which was shut down last week until the end of the year due to chip shortages, on Thursday accused the carmaker’s owner, Stellantis, of exploiting Germany’s furlough scheme to move production out of the country.

Union officials fear that Opel, which is bound by an agreement struck last year not to make any workers in Germany redundant until 2025, is placing Eisenach workers on furlough as a temporary fix that could evolve into a longer-term shutdown.

The Grandland X model being produced in Eisenach will be made at the company’s Sochaux plant in France until the shutdown lifts, but workers fear it will be moved there permanently.

“We won’t let this be done to us,” local workers’ council head Uwe Loesche wrote in a statement published on union IG Metall’s website on Thursday.

Two unions in France last week issued a similar critique of Stellantis’ use of the furlough scheme, alleging that the company was using the chip shortage as an excuse to furlough a disproportionate number of people to pocket taxpayer funds.

Stellantis did not immediately respond to a request for comment on the accusation from IG Metall.

Stellantis has not been clear about whether production will re-start at the plant, the union said – but Stellantis’ own chief executive, Carlos Tavares, alongside other heads of automakers and industry experts, predict the chip crisis will carry on well into 2022.

The company has stalled production at plants across France, the United States and Italy in recent months due to the chip crunch, forecasting it would make 1.4 million fewer vehicles this year.

Analysts have said the world’s 4th largest carmaker, formed earlier this year through a merger of France’s PSA and Fiat Chrysler, has a severe overcapacity problem that could lead to plant shutdowns, though CEO Tavares has promised that his endeavours to turn around Opel’s profits would not involve factory closures.

(Reporting by Victoria Waldersee, additional reporting by Gilles Gillaume; Editing by Steve Orlofsky)

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