opel bochum opening 1962.automotiveIT

Opel opened the Bochum plant in 1962 (Photo: Opel)

Opel plans to end car production in Bochum, Germany, in 2016 as it reacts to continuing losses in the shrinking European car market.

The German division of General Motors of the US said in a press release that it will cease car production in Bochum at the end of the lifecyle of the current Zafira minivan.

Opel will continue to run a warehouse in Bochum and may also manufacture components there.

Despite the planned closure, the carmaker reaffirmed its commitment  to Germany as a car-building location. "Germany is our most important market and with about 20,000 employees the backbone and home of our brand. And this will stay this way in the future,” Opel Deputy CEO Thomas Sedran said.

Opel has been making losses for years and various management teams have proposed different solutions to restore profitability. The company has also seen significant management turnover and is currently looking for a new CEO.

The Bochum plant closure is part of a new drive to move to break-even results by the middle of the decade. The plan includes boosting revenue, improving cost efficiency, boosting the image of the Opel brand and entering new markets and segments.

Opel is heavily dependent on the European car market and the decision to close Bochum was taken against a backdrop of plummeting sales and big overcapacity in Europe. In the first 10 months of the year, passenger car sales fell 6.9 pc to 20,722,859 units, according to ACEA, the European Car Manufacturers Association.

The brand isn't the only one to respond to the decline in the market. In October, Ford Europe announced it was closing assembly plants in Belgium and the UK as well as a UK-based components facility. And France's PSA/Peugeot-Citroen intends to close a factory in a Paris suburb.