Opel | Motor Stalled

The Opel factory on the edge of Vienna has been fading for years. It now looks like the end is in sight for the remaining employees.

For 38 years, the carmaker Opel has been producing engines and gear boxes in the Viennese suburb of Aspern. At its peak in the 1990s, the factory employed some 3000 people. But do a search for Opel Aspern today and doom and gloom stories going back to 2012 light up the screen. 

Last week another 200 jobs were gone; for the remaining 600, it’s only a matter of time – an object lesson in the harsh realities of market share and global corporate consolidation, whose victims are all on the production line, guilty of nothing but doing their jobs.

It is a venerable name, founded by Adam Opel in the 1860s, and by the 1890s Germany’s largest auto manufacturer. In 1931 America’s General Motors bought control and by 1938, Opel was responsible for over 40% of total German exports. (The General Motors VP responsible for Opel was awarded the Order of the German Eagle by a grateful Adolf Hitler). In WWII, Opel was a major regime-directed supplier to the war machine, delivering thousands of sturdy 3-tonner trucks to the Wehrmacht. After the war GM was back in control, and in 1979, Austria’s legendary entrepreneurial Kanzler Bruno Kreisky persuaded the Americans to locate a major production facility in Aspern. But by then Opel was already in decline: reporting a gradual loss in share on the huge German domestic market. 8}

Sold to PSA

As the German company slid into losses, the bosses in Detroit became increasingly nervous. Top American managers were parachuted in, the main Rüsselsheim workforce was steadily reduced and major advertising campaigns failed to turn things around. The Austrian supply factory began to feel the pressures: A partnership with Fiat and the Austro-Canadian Magna came to nothing, as did a brief flirtation with China’s Beijing Automotive Industry Holding Company. The financial hemorrhaging continued and in early 2017, the entire Opel group was sold to the French PSA (essentially Peugeot and Citroen). 

From then on, it would only be a matter of time until Opel became French. Sturdy but pragmatic resistance from the trades unions offered pay cuts in exchange for job guarantees, but management continually reneged on promises. “We’ve known for years, that the motor business would end,” sighed union leader Renate Blauensteiner.  

The final irony: Aspern has long been proud of its role as the scene of one of Napoleon’s few defeats, where on May 21st 1809, the Austrian army drove back the French forces trying to cross the Danube. This time, the French have clearly won.

Simon Ballam
English, studied in NY and worked in London, Düsseldorf, NY, Fankfurt, Prague and Vienna. This covered stints in market research and the film industry, international advertising coordination and strategic planning. Currently business school lecturer and journalist.

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