Trades unions at the plant, which employs 2,500, saw their hopes of relief dashed on Monday when Magna confirmed Antwerp would have to close, together with the loss of 10,500 jobs across Europe, half of them in Germany. “We will do everything we can to avoid job losses,” CEO Siegfried Wolf said.
Peeters will meet with EU industry commissioner Günter Verheugen, and draw special attention to claims made by the German magazine Der Spiegel, apparently based on documents delivered to the Commission by Magna and the German government, that Opel Antwerp is more profitable than the Opel plant in Bochum. If that is the case, then the Commission will be encouraged to look into what enticements were offered by Germany to turn Magna against Antwerp.
Not that Flanders is against state aid to industry: in an earlier phase of the situation, Peeters’ government was willing to put its hand in its pocket to offer some “sweeteners” to the successful bidder for GM Europe, hopefully with a contribution from the federal coffers. Peeters was reported to have ready a package of up to €500 million of his own to offer to Opel, after the Opel board chairman Klaus Franz stated that Opel Antwerp could be kept open for a price of €200 million.
“There are reliable studies which show that Antwerp scores better than factories in Germany,” Peeters said. “Those reports should be made public as quickly as possible.”
On Sunday, federal foreign minister Yves Leterme had an informal meeting with the 27 EU trade ministers to raise the issue. He also held more detailed talks with the ministers from Germany, Spain and Hungary – all three countries which have GM plants on their territory. They have an interest in ensuring that Germany’s interests are not the only ones being considered.
The United Kingdom also has a stake in the issue. Former trade commissioner Peter Mandelson told BBC Radio at the weekend that the British government looked to the Commission to ensure fairness. “Our Vauxhall plants at Ellesmere Port and Luton are highly efficient and I am sure, and we insist, that this be recognised,” he said.
The objections to the German aid to Opel are based on three main elements in the EU’s rules:
• The business in question must be independently viable, which is clearly not the case for Opel. State aid is not allowed if its aim is to prevent a company from going bust. According to at least two experts, under its current form, the new Opel is likely to be facing bankruptcy in 2010 or 2011, even if the aid is paid.
• It is not permitted to grant state aid to keep open a particular unit or operation. “I think it is important to say that the Commission should not accept any linkage between aid and retention of jobs in any specific plant or country,” Mandelson told the BBC.
• The amount of the loan granted by the state should not be more than the salary costs of the company. In the case of Opel, the €4.5 billion on offer is about double last year’s total wages bill for the company. According to Vic Heylen, a former Commission adviser on aid to the car industry and now a specialist with Flanders Centre for Automotive Research, the decision to abandon Antwerp is based on changes made in 1998, when the UK government attracted production of the Opel Vectra to Ellesmere Port with aid that was then approved by the EU. That left Antwerp in a vulnerable position as a single-model factory, producing only the Astra. Economist Geert Noels, on the other hand, blamed Antwerp’s weak position on a lack of competitivity, with wage costs in Belgium now higher than in Germany – the reverse of the situation in the banner years of the 1980s.
Unions, meanwhile, remain upbeat. “Opel Antwerp is not dead and buried yet,” said ABVV head Herwig Jorissen. “We’ll see how the Antwerp factory can survive. I don’t want to give away too much about our negotiations, because we still have a long way to go. But we’re not in the ground yet.”