Halt to Opel production not the end for Bochum | Business| Economy and finance news from a German perspective | DW | 10.12.2012
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Halt to Opel production not the end for Bochum

20,000 workers' jobs depend directly and indirectly on the Opel car factory in Bochum. But the decision to halt auto production there may leave other, more future-oriented employment opportunities to be tapped.

With 380,000 inhabitants, Bochum is Germany's 16th largest city. Located in the western state of North Rhine-Westphalia, it rarely makes it into nationwide headlines. But that's changed. For months, Bochum has been fighting to keep its Opel plant, but the carmaker's parent company, General Motors (GM), has now decided to discontinue car manufacturing as of 2016.

It is not the first huge loss of jobs for Bochum in its recent history. Only four years ago, Finnish mobile phone maker Nokia shut down its facility in the town almost overnight, which meant a sudden loss of 4,000 jobs.

Opel plant in Bochum

Opel's future is in the hands of Detroit

It was a serious loss for municipal coffers, too, with around 25 million euros ($31.2 million) annually in commercial tax no longer coming in.

The end of Opel's car production may have less dramatic consequences, though. The factory will remain in use as a distribution center for Opel's European operations as well as a finishing site for various parts. That means part of its 3,000 on-site jobs will stay in place.

25,000 jobs, once

As mining activities rapidly declined in the late 1960s, Bochum focused on attracting transnational companies as part of its structural facelift. And when Opel signaled its interest to come, the town didn't have to be asked twice. To make Opel feel comfortable, Bochum bought up a huge area of land that was later made available for the carmaker's production site. It was a huge municipal investment with a view to creating 25,000 jobs at a later stage.

Following a streamlining process and an accompanying multi-phase job cull, only 3,200 jobs are left now. Town manager Paul Aschenbrenner says Bochum is putting up a fight to keep at least those remaining jobs. "This year, the Opel plant here marks its 50th anniversary, and for me personally and the citizens here it's disappointing not to know where we're heading right now," he said.

Perfidious GM strategy?

Rouven Beeck from the local chamber of commerce isn't happy about General Motors' strategy. He is critical of GM's global strategy that prevents Opel from selling its cars outside Europe - excluding it from emerging economies such as Brazil, China and India - even though GM sells Chevrolet cars in Germany.

Model of electric car

Building electrical cars could become an alternative in Bochum

The people in GM's headquarters in the US will most likely remain unfazed by such criticism. But what's at stake are round 20,000 jobs, suppliers included. The closure of the Bochum plant would no doubt mean another dent in the town's image, Beeck admits.

Leaders in Bochum have agreed to fight to preserve as many Opel jobs as they can. Large neighboring cities like Dortmund and Essen have unemployment rates well above 10 percent, while Bochum is well under that figure - at least for now. The future of a ThyssenKrupp stainless steel factory also hangs in the balance. After it was sold to the Finnish industry leader Outokumpu, there is a pledge to maintain it only through 2016. Its 1,600 employees don't know what to expect after that date.

Not beautiful, but attractive

But Bochum should not be written off completely. Banking on internationally operating companies hasn't been the town's only strategy - a fact that's reflected in its comparatively strong employment rate, said Aschenbrenner.

The town currently has 126,000 jobs that are subject to social insurance contributions. The number of people dependent on welfare is put at little under 39,000. Architecturally, Bochum is anything but beautiful, but it's attractive in its own way. The local theater enjoys an excellent reputation nationwide. And thousands of visitors flock to the town every year to see the musical "Starlight Express".

Future-oriented employment

Bochum is no longer the plain Jane of Germany's Ruhr area. It's home to the European headquarters of oil company BP and also boasts eight universities that perform a lot of research. The town also boast the country's only "health campus," home to many firms from the healthcare sector with 23,000 employees.

The 8,000 jobs in the creative industries and in numerous small and medium-sized engineering companies are another beacon of hope. Many towns in the Ruhr area have been considered dead by the media in the wake of the region's large-scale restructuring drive after the demise of mining there. But without much ado, Bochum has already paved the way for its own survival.

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