Polish Car Plant Closure to Force 1,650 Lay-offs

Plant was assembling General Motors' Aveo model

Due to a lack of fresh contracts at the Ukrainian-owned factory which has been assembling General Motors' Aveo model, some 1,650 workers will lose their jobs at Warsaw's FSO car plant. According to senior FSO manager Roman Bugaj the plant will not be shut down entirely, but rather put into so-called hibernation mode after production ends on Feb. 23.

"The production facilities will remain the property of the company -- the press line, the welding line, the paint shop and the assembly line won't be sold off" in the hope of attracting fresh contracts, Bugaj said.

FSO however does plan to sell off part of the factory's buildings, first used to assemble vehicles in the 1960s.

Some 1,200 of the company's 1,820 workforce will be laid off on March 1, with an additional 450 people let go in June. Nearly 200 workers will be kept on for maintenance purposes.

The laid off workers will be able to return to their jobs should a new production contract be secured, according to Bugaj.

The factory is said to be in talks with partners from China and India.

In 2005, UkrAvto acquired FSO from the then troubled South Korean group Daewoo. The following year General Motors reached a deal with UkrAvto to produce its Chevrolet Aveo economy car at the FSO plant.

Last year 45,000 Aveo-model cars rolled off the FSO production line.

Copyright Agence France-Presse, 2011

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