A restructuring deal at General Motors' loss-making European carmaker Opel was signed into effect on Monday, aimed at saving 265 million euros ($325 million) in annual wage costs through 2014, labor leader Klaus Franz said.
After drafting a master agreement on May 21, European union and workforce representatives from countries hosting Opel's major manufacturing plants also signed the deal with Opel Chief Executive Nick Reilly.
Franz said the signatures meant neither side can now withdraw from the contract, eliminating concerns that it might only be valid if Germany agrees to over 1 billion euros in loan guarantees.
"In the unlikely event that Germany doesn't grant state aid, we can no longer be extorted," Franz told Reuters, adding that all the conditions and terms agreed earlier had been adopted into a final binding agreement.
Spokespeople for Opel could not immediately be reached for comment.
All parties to the deal had signed apart from representatives from the Opel plant in Bochum, Franz said, adding he expected them to sign soon.
SCEPTICAL ON AID
Earlier on Monday business advisers to Germany's rescue fund met in Berlin to discuss whether to recommend extending loan guarantees to Opel, but the result of the talks was not known.
Parent General Motors had requested state aid from European governments to help fund a costly turnaround plan at Opel that would shrink its production and labor capacity by about 20 percent.
GM's own return to the black has provided opponents within Germany plenty of ammunition to argue against aid to Opel.
The advisers to the rescue fund are mainly former captains of German industry, such as ex-Schering CEO Hubertus Erlen and industry lobby group BDI's former head Michael Rogowski.
Even if they agreed on a recommendation on Monday the decision ultimately remains a political one and German Economics Minister Rainer Bruederle has indicated more time will pass before the issue can finally be settled.
"In the end, the decision lies with the Economics Ministry," Bruederle told reporters in Brussels on Monday, reaffirming he remained skeptical about giving aid to Opel despite the repeated calls from four German states which host plants.
