After months of negotiations, the Opel management and the IG Metall union-controlled works council came to an agreement in principle on the future of the sites of the German subsidiary of PSA. In exchange for additional wage efforts and a staff reduction capped at 3,700 out of 19,000 in Germany, the staff obtained a backup of the production, research or logistics sites until the summer of 2023.
The agreement in principle, which took place during a sixteenth round of negotiations under the aegis of a mediator, is still subject to a formal contract between Opel management and the EC. It puts an end, at least for the moment, to an exceptional standoff between PSA and IG Metall, who have accused each other of unconsciousness in the face of the abyssal losses of the German car manufacturer and non-compliance with the commitments made.
“The measures decided today are an important step forward in achieving the goals of our ‘Pace’ strategic plan,” said Opel boss Michael Lohscheller. The plan provides for operating margin 2% in 2020 and 6% by 2026. “The increase in competitiveness allows us to invest and secure a good future for our employees,” he added without specifying the amounts involved.
To gain visibility over five years, employees agreed to waive some of the 4.3% branch wage increase signed between IG Metall and the German metalworkers’ association. If a first part is effective since April 1st, the second part, which comes into effect on January 1st, 2019, will not be applied. The next revaluations after 2020 will also be delayed in time, according to the EC.
In addition, the voluntary departure program (early retirement and benefits) will be limited to 3,700 employees. In the Eisenach plant, at the heart of the conflict, departures will not exceed 450 people out of a workforce of about 1,800. Industrial showcase of the Reunification, the site will receive the production of Grandland X SUV, including its hybrid version. The school committee will put an end to the blockage of the departure program decided in May.
Political relief
“After the tough negotiations, this is a result that will finally allow Opel employees to breathe and, when everything is done, to sleep a lot more peacefully,” said Wolfgang Schäfer-Klug, Opel’s CEO. Both parties will now begin to sign a formal tariff agreement, which may also be complex. Investment commitments will be particularly sensitive.
This agreement in principle was immediately welcomed by German politicians, who follow the issue very closely. “The fight for Opel’s jobs has been worth it,” Bodo Ramelow, the minister-president of Thuringia, wrote on Twitter, expressing satisfaction that “we can look positively towards the future in Eisenach”.