(RTTNews) -  Automaker General Motors Co. (MTLQQ.PK: News ) has announced it plans to cut 10,000 jobs across its European car unit Opel, which includes the Vauxhall brand in the UK, according to media reports Thursday.

General Motors, which emerged from bankruptcy in July, had said on Tuesday that it was halting its deal to sell Opel to Canadian car parts firm Magna. GM board had decided to retain the German unit Adam Opel GmbH and British sister brand Vauxhall, citing the improving business environment as well as the brands importance to GM's global strategy.

It was in early September that GM had agreed to sell its majority stake in Opel and Vauxhall to a consortium led by Canadian car-parts maker Magna International, Inc. (MGA, MG-A.TO). Magna teamed up with Russian auto maker OAO GAZ Group and state-controlled Russian financial group OAO Sberbank for the deal. The deal was originally expected to be signed in early October and close by the end of November. The German government has helped Magna to win the bid by offering 4.5 billion euros or US$6.4 billion in state aid.

GM's President and Chief Executive Officer Fritz Henderson said in a statement on Tuesday, "GM will soon present its restructuring plan to Germany and other governments and hopes for its favorable consideration. We understand the complexity and length of this issue has been draining for all involved. However, from the outset, our goal has been to secure the best long term solution for our customers, employee, suppliers, and dealers, which is reflected in the decision reached today. This was deemed to be the most stable and least costly approach for securing Opel/Vauxhall's long-term future."
The new General Motors is planning a restructuring of its European operations, which could see total restructuring expenses of about 3 billion euros.

Reports also said that union leaders at Vauxhall, which employs 5,500 people, would see that the number of jobs lost is minimized and will also ensure that they are voluntary. Germany's powerful workers' union, IG Metall reportedly has said yesterday that workers at Opel's four German plants would hold warning strikes today in protest at GM's decision.

MTLQQ.PK closed Wednesday's regular trading at $0.602 on the OTC.

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by RTT Staff Writer

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