Opel gives notice of lower profits and production

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The Independent Online
OPEL'S profits in 1992 will be 'much lower than in the past good years', David Herman, head of General Motors' German subsidiary, said yesterday.

With the German car market facing troubled times and Opel already obliged to adopt short-time working, Mr Herman said that its production of new cars in 1993 would certainly fall below the 1.1 million of last year.

For the German market, where Opel produced 670,000 vehicles last year, it expects to manufacture 100,000 fewer this year.

'When the leading economic institutes predict growth for 1993 around 0 per cent, we know from experience that this is rather optimistic,' Mr Herman said.

In preparation for declining sales Opel has already reduced its 57,000 workforce by nearly 4,000. Its central plant at Russelsheim is stopping work one day a week until the end of March.

The continuation of comparatively strong sales in eastern Germany, particularly of the Astra, boosted turnover last year by 7 per cent to DM29bn ( pounds 11.6bn).

While new Opel registrations in Germany were overall 6 per cent down on 1991's 713,000, the company managed to hold its level of new registrations in the east.

Last year was Opel's second- best ever after the record sales year of 1991.

It also managed to maintain its position as market leader in eastern Germany. Overall market share in Germany was 17 per cent, 0.2 per cent down on 1991.

Mr Herman predicted that sales of new cars in Germany would decline from an overall total of nearly four million last year to 3.2 million in 1993.

The shrinking German market would have a strong effect on the rest of Europe, he said, dragging overall European new sales from just over 13 million to a little over 12 million units.

Volkswagen is putting between 50,000 and 55,000 workers on short time at its six German plants. A spokesman said 23,000 of the 58,000 employed at the main plant at Wolfsburg would be laid off for 12 days.