VW Cuts Jobs in Brussels

Volkswagen officials announced Tuesday that they would no longer build their best-selling Golf model at the Forest plant in southern Brussels because there was not enough demand for the cars it produces.

The job cuts, described as a "national catastrophe" in the words of Forest mayor Corinne de Permentier, come 10 years after the closure of a Renault plant in Vilvoorde north of Brussels, from which the region has struggled to recover.

Europe's biggest carmaker employs around 5,400 people at its Forest plant, but workers have been concerned for their jobs since a management shake up in Germany earlier this month.

Workers downed tools on Friday following press reports that the plant, which has long been the subject of rumors of outright closure or mass lay-offs, faced a major restructuring. Union officials said the job cuts would leave roughly 1,500 workers at the factory, but voiced fears that the lay-offs could be a prelude to full closure of the site.

Trade unions: The worst catastrophe

"This is the worst catastrophe that we've been through so far," said Pascal Van Cauwenberge, an official with the CSC Christian union at the factory. "In my opinion, with 1,500 workers, Volkswagen Brussels is no longer viable. It's the first step before closure."

As tensions with management rise, unions called on workers to protest outside the plant Tuesday afternoon.

"We have the impression that we've been abandoned by everybody," said 43-year-old worker Joseph De Geyter while awaiting news with about 50 other colleagues at the entrance of the plant. "If 4,000 people are fired, that's because we don't count any more."

Close to 193,000 Golf cars were scheduled to be built in Brussels this year and 11,000 Polo cars.

Major restructuring

Volkswagen is in the process of implementing a vast restructuring plan, sparked by losses at its flagship VW brand and difficulties in the all-important Chinese market. The German group is to slash 20,000 jobs across Germany and was known to be preparing to wield the axe in Belgium, Portugal and Spain.

VW officials said in a statement that they would manufacture the Golf at only two European sites in future, both in Germany at the group's home plant in Wolfsburg and at its Mosel factory in Saxony. They added that production in Germany would be "considerably cheaper."

"The car market in western Europe is saturated and is struggling with overcapacity," the statement said. "Despite increased market share, our western European plants are not operating at full capacity."

There was also little room for boosting export sales as a result of the strong euro and custom regulations in growth markets such as Russia, India and China, VW said.

EU to help affected workers?

The auto giant did not specify how many jobs might be slashed, but it said that talks were underway with employee representatives at the Forest site.

"All economic alternatives are being explored with a view to securing as many jobs as possible in Brussels," the statement said.

The European Commission, which is also a major employer in Brussels, is studying "a package of measures," including making available EU structural funds, to help workers acquire new skills and aid suppliers restructure to focus on new markets, a spokesman said.

The plant's subcontractors employ about 10,000 people.