October 31, 2012 / 3:08 PM / in 7 years

GM targets $500 million in cost savings, job cuts in Europe

DETROIT (Reuters) - General Motors Co is targeting $500 million in fixed-cost savings between 2013 and 2015, and it plans to make further job cuts in Europe as it seeks to break even in the region by mid-decade, the automaker said on Wednesday.

“These are net fixed-cost reductions, not gross fixed-costs reductions” between 2013 and 2015, GM Vice Chairman Steve Girsky, who is leading the restructuring at Opel and Vauxhall, said on a conference call on Wednesday.

GM makes and sells cars through its Opel brand in most of Europe and through the Vauxhall brand in Britain.

GM said it would cut the shifts at its Opel plant in Eisenach, Germany, to two from three next year, according to an online presentation made after the top U.S. automaker reported third-quarter earnings earlier on Wednesday.

The Detroit-based company posted a surprisingly strong quarterly profit and said it was targeting breaking even in Europe in mid-decade. It expects to lose as much as $1.8 billion in Europe this year.

GM said that by the end of this year, it will have cut 2,600 jobs in Europe. So far this year, it has cut 2,300 from its Opel and Vauxhall operations.

This year’s job cuts at Opel and Vauxhall will bring the headcount of those two brands to about 37,350 employees.

Reporting By Ben Klayman; Editing by Gerald E. McCormick and Lisa Von Ahn

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