Europe cutting backBy Team Overdrive
Faced with a continuing declining market, European car makers are starting to confront the issue of over-capacity – which some analysts estimate is as high as 10 million cars a year. For the volume manufacturers this means shutting plants. Ford, which estimates a loss of Rs 8226 crore on its European operations this year, will close its factory at Genk in Belgium. In the UK, it will shut their Southampton factory which makes special versions of the Transit van and also close its pressing and tooling plant in Dagenham, near London. Meanwhile General Motors – which is expected to stop car production at the Opel factory in Bochum, Germany – has given more details of how it plans to benefit from its tie-up with Peugeot.
Earlier this year GM paid Rs 2237 crore for a seven per cent stake in Peugeot as part of alliance aimed at costs savings of Rs 10,969 crore a year. At that time the only shared product anticipated was a jointly-developed small car. Now the two companies have revealed that they plan four common vehicle projects: a small MPV, a compact SUV crossover, a small car for Europe, and a new mid-size family car. There was no word on whether or how GM and Peugeot might cooperate in India.