Is General Motors Company (GM) Turning up the Heat in Europe?

Analysts have been critical of that plan, saying that GM underestimates the risk of further market share declines – a criticism that looks more valid with every passing month. But now GM is saying that it may accelerate the plan to close Bochum and eliminate its 3,000 jobs. Girsky’s letter said that Bochum could close at the end of 2014, the earliest date allowed by existing labor agreements.

That would certainly help GM attain its goal for Opel of reaching break-even by mid-decade – if it comes to pass. But even that is far from certain.

Turning up the heat on Opel’s unions
The plan to move up the Bochum closing is likely just one of a long list of concessions GM would like to get from Opel’s union in the current round of talks, and it’s important to emphasize that none of those concessions is a done deal at this point.

German law gives unions great power, and the sensitivity of German political leaders to the possibility of job losses means that GM has to tread carefully. Bochum would be the first auto factory to close in Germany since the 1940s, and even with four years’ warning the earlier plan to close it after 2016 caused much consternation.

Still, as market share continues to erode and big losses continue to mount, it’s becoming clear to investors that GM will need to do more to transform Opel into a profit center. The good news is that Girsky’s letter suggests that it’s clear to GM’s leadership as well. Can the union be convinced to agree? Stay tuned.

The article Is GM Turning up the Heat in Europe? originally appeared on Fool.com.

Fool contributor John Rosevear owns shares of General Motors and Ford. Follow him on Twitter at @jrosevear. The Motley Fool owns shares of Ford. Motley Fool newsletter services recommend Ford and General Motors.

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