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LCV Study Highlights Need for More Competitive Cost Structure for Combo Production to Be Profitable


May 2006
 Filed under: GENERAL MOTORS CORPORATE Car News | GENERAL MOTORS CORPORATE Headlines

An extensive analysis of the production operations points to manufacturing cost issues at GM’s Azambuja plant

Zurich/Azambuja, 2006-05-30 -- General Motors (GM) announced today the conclusion of the study of its Light Commercial Vehicle (LCV) business. The study aimed to identify cost and revenue improvements to support the company’s ongoing plan to return to sustained profitability. An analysis of Combo production at the Azambuja plant in Portugal, pointed to a 500 Euro cost disadvantage per unit at the facility when compared to other possible production locations.
GM has vowed to work with the appropriate workers’ representatives to explore possible solutions. The company expects to conclude these discussions in the middle of June.

“We are facing fiercer competition and must continually improve our productivity in the Western European car plants in order to reduce our operating costs and to secure the future of the business. Together with our labor representatives we will search for options to make the plant competitive in today’s environment,” said Carl-Peter Forster, President of General Motors Europe.

Eric Stevens, GM Europe Vice President Manufacturing said, “I recognize the Azambuja team’s efforts to increase their competitiveness in a tough environment. Unfortunately, not every element of manufacturing cost is within their direct control. We will focus our efforts in the coming weeks to address other structural issues with the appropriate stakeholders to determine the best course of action – and as always, we will keep our workforce informed first.”


General Motors Corp. (NYSE: GM), the world’s largest automaker, has been the global industry sales leader for 75 years. Founded in 1908, GM today employs about 327,000 people around the world. It has manufacturing operations in 33 countries and its vehicles are sold in 200 countries. In 2005, GM sold 9.17 million cars and trucks globally, up 2 percent and the second-highest total in the company’s history. In Europe, GM sells its Opel, Vauxhall, Saab, Chevrolet, Cadillac, Corvette and Hummer ranges in over 30 markets. It operates 11 production and assembly facilities in eight countries and employs around 64,500 people. GM operates one of the world’s leading finance companies, GMAC Financial Services, which offers automotive, residential and commercial financing and insurance. More information on GM can be found at http://media.gmeurope.com/ and http://www.gmeurope.com.

Source: GM

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