VW ends Golf car production in Belgium

BRUSSELS, Belgium Nov 21, 2006; Constant Brand writing for the AP reported that Volkswagen AG said Tuesday it would stop production of its Golf model at its Belgian plant, shocking workers and government leaders who fear more than 3,500 jobs could be lost.

Company officials said the German car maker will move all production of the Golf to plants in Mosel and Wolfsburg in Germany as part of plans to cut production in Western Europe due to falling demand.

VW spokeswoman Evelyne Helin said 1,500 jobs could be salvaged out of the 5,300 at the assembly plant in the Belgian capital, through new projects and measures to reduce working time. "However, that is not a firm figure," she said.

Helin said the factory currently produces 204,000 vehicles per year, 190,000 of which are Golf models.

The announcement is the worst single job cut in the Brussels region since the sudden closure of the Renault SA car plant just outside the capital in 1997, which cost 3,100 jobs and led to an overhaul of European labor laws forcing companies to inform workers of plant closures well in advance. Automaking in Belgium took another major blow three years ago when Ford Motor Co. shed 3,000 jobs from its assembly plant in the eastern city of Genk.

"We will make every effort to find solutions, to keep jobs here," Paul Lenaerts, a manager at the factory told RTBF television. Belgian media reported that as compensation the Belgian plant could produce more of the Polo model.

Volkswagen argued the transfer of production was necessary because of western Europe's stagnating car market, which has led to an overcapacity. The company said its German sites will also undergo a "profound restructuring."

"We are shocked, it's a catastrophe," said Guy Daneel from the CSC Metal union.

Workers vowed to continue strike action which has stopped production at the plant since Friday as rumors of the cuts emerged. Several were seen burning German flags and Volkswagen flags outside factory gates in protest.

"We had expected a lot of cuts, but not this," said Tony Janssen from the ACV Metal union.

Political leaders said they were organizing talks with unions and Volkswagen to see how they could help those laid off. At over 16 percent, unemployment in Brussels is already among the highest in the European Union.

Prime Minister Guy Verhofstadt said he was dismayed and blamed Volkswagen for putting national interests ahead of good business practices.

"I'm shocked that national reasons lie behind this decision," Verhofstadt said. He urged all workers to remain calm and await word on what opportunities might still exist in the Volkswagen operation.

He said he would meet company directors in December but was not hopeful he could persuade them to reverse their decision.

The European Union said Belgium could apply for EU aid to help retrain workers. "We are aware of the challenging effect that any large-scale redundancy with Volkswagen can have for the Brussels region," said EU spokeswoman Katharina Von Schnurbein.

Many workers outside the plant were in tears as the news of the cuts were released.

"I'm 44 years old. It's not going to be easy to find a job," Joseph de Geyter told RTBF. "They talk about retraining, but what am I going to do?"

German media reports have identified the Belgian plant as a potential candidate for closure as Volkswagen seeks to save money by shedding jobs in Spain, Portugal and Belgium instead of making more cuts in its home country, Germany.