GM Starts Building $300 million Polish Car Plant

10/04/96

Reuters has reported that GM broke ground for a new plant in Gliwice, Poland. The automaker will sink $308.2 million into the construction project, which, when finished, will be an assembly plant capable of producing 72,000 passenger cars a year. Production at the plant is slated to begin in 1998.

The plant will be run by GM's German unit, Adam Opel AG. David Herman, Adam Opel president, said, "This venture goes beyond a simple investment. It is a long-term commitment to the future of the region and Poland."

The Gliwice factory is located in an area threatened by massive lay-offs in the mining industry. The new plant will employ 2,000 people and will be based on Opel's state-of-the-art assembly plant in the German city of Eisenach. Workers at the plant will assemble a low-cost family car based on the Opel/Vauxhall Astra model.

The plant will include metal stamping, welding, paint and final assembly units. GM's goal is to use 60 percent locally produced parts in car assembly at the plant, after several years.

Poland's President Aleksander Kwasniewski and German Foreign Minister Klaus Kinkel attended the ground-breaking ceremony. Kwasiewski said the investment illustrated that Poland's fast-growing economy was making progress toward integration with Western Europe.

Kinkel predicted that Gemran investment in Poland (currently $1.3 billion) would soon match U.S. investment ($2.4 billion), and drew a comparison between German-Polish relations of the late 30's and the current state of affairs: "It is symbolic that here in Gliwice, where World War Two started, we open a new chapter in the relations between Poland and Germany"

New car sales in Poland rose almost 36 percent to 260,000 in the first eight months of 1996, year-on-year. Analysts expect they will reach 500,000 units annually in the year 2000.

Paul Dever -- The Auto Channel