Magna Plants to Cut 10,500 Opel Jobs

The European Union will discuss the Magna - Opel deal today, so a final verdict is yet to be released, but speculation on the future plans of the Canadian - Austrian partsmaker has already started surfacing. It appears that Magna plans to cut around 10,500 jobs at the German brand, according to Frankfurter Allgemeine Sonntagszeitung who cited a Magna source close to the matter.

Out of the 10,500 affected employees, approximately 4,500 are working in Germany, the source added. However, the new owner doesn't plan to fire the workers but to establish special programs to allow them to voluntarily leave the company in return for money and/or benefits compensation.

Specific details on the matter are yet to be unveiled, as those involved are still negotiating on the terms of the deal, but more information is very likely to come after EU's decision. Magna representatives have not commented on the plans.

Meanwhile, Magna is already looking at ways to make Opel profitable and such a scenario is possible by 2011, as officials involved in the matter revealed. Furthermore, John Smith, GM's chief negotiator for the deal, said Magna wants to repay debts and government loans by 2014 and start paying dividends by 2015. Germany will provide $4.5 billion euros (around $6.6 billion) to support the Opel restructuring process, with other European countries hosting important Opel facilities to also contribute to the loan package.

Additionally, General Motors intends to close the deal by November, but the American carmaker will continue collaborating with Magna on platforms, engines, manufacturing and purchasing.

"I see no obstacles to getting the deal done successfully by the end of November,"
John Smith said according to Autonews.
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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