Stellantis looks at splitting off Opel plants in Germany

BERLIN -- Stellantis, owner of Opel, is considering splitting off the German automaker's largest plant and a second plant, which is shutting down temporarily next week due to chip shortages.

The two plants, located in Russelsheim near Frankfurt and Eisenach in central Germany, would no longer be part of Opel Automobile but would remain linked to Stellantis, a company spokesperson said on Thursday.

Talks are underway with unions about the potential plan.

General Motors sold Opel in 2017 to PSA Group in a $2.3 billion transaction. PSA this year merged with Fiat Chrysler Automobiles and renamed the combined company Stellantis.

"The advantages associated with this more efficient and flexible organization should contribute to securing jobs in the long-term," the spokesperson told Reuters.

The news, reported first by German newspaper Handelsblatt, comes after unions expressed concern that the Eisenach plant could be shut down permanently after the company said it would be closed for three months due to the global chip shortage.

Workers at the plant on Thursday accused Stellantis, of exploiting Germany's furlough program to move production out of the country.

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

Until the shutdown is lifted, the Grandland X model being produced in Eisenach will be made at the company's Sochaux plant in France -- but Eisenach workers fear it will be moved there permanently.

"We will not 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.

French criticism

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.

"The global automotive industry is in an exceptional situation due to the ongoing pandemic and a global shortage of semiconductors," Stellantis said in an emailed statement to Reuters when asked about the union's concerns.

"Production in Eisenach is scheduled to start again at the beginning of 2022, provided the supply chain situation allows."

Stellantis CEO Carlos Tavares, alongside other heads of automakers and industry experts, predict the chip crisis will carry on well into 2022.

Analysts have said that Stellantis has an overcapacity problem that could lead to plant shutdowns, though Tavares has promised that his endeavors to turn around Opel's profits would not involve factory closures.

Stellantis, formed through a merger of PSA Group and Fiat Chrysler, 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.