By Ilka Kopplin
FRANKFURT-- General Motors Co's Opel unit, responding to the
slump in the Russian market, will halt production for nearly two
months at its St. Petersburg, Russia, facility and review its plans
for the region, an Opel spokesman said Thursday.
Opel, the German arm of GM, will shut production at the plant
from March 23 to May 15 this year. In 2012, Opel had said it would
invest $1 billion in Russia over five years, much of it dedicated
to more than doubling production capacity in St. Petersburg to
230,000 vehicles a year by this year, and increasing the workforce
to 4,000 from 2,500 people at that time. Some of the investment was
also aimed at beefing up production at GM's joint venture with
Avtovaz in Togliatti, Russia.
Developments, however, have gone in the other direction. Last
year, Opel reduced the number of shifts to one from two in St.
Petersburg. The workforce had by then dwindled to some 2,000
people, 500 of whom were offered severance packages in September.
Since then, more severance packages and natural attrition have
whittled the workforce down to 1,000, the spokesman said. Last
year, just about 37,000 vehicles rolled off the assembly line at
the plant.
Vehicle sales for GM's Opel, Chevrolet and Cadillac brands
dropped 26.4% last year to 189,484 units.
Flagging demand in Russia, once considered a major growth
market, has hit a variety of manufacturers and car makers. Europe's
largest auto maker Volkswagen AG also let production idle
temporarily in Russia last year. Auto makers sold 2.5 million cars
and light vehicles in Russia altogether last year, down 10% from
2013, according to German auto association VDA.
Write to Ilka Kopplin at ilka.kopplin@wsj.com
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