Detroit, MI, United States (4E) – General Motors Co. moves to cut back its presence in the European auto market as the world’s biggest auto maker disclosed that it is in talks with two European firms to sell its vehicle-transmission plant in France.
The company said on Friday that negotiations with ZF Friedrichshafen AG and Punch International NV have reached advanced stage for the sale of its Strasbourg factory as it tries to reduce costs in its struggling European operation.
A spokesperson of the plant said that GM could sell the factory to Punch and ZF to produce 8-speed transmissions. The move could potentially save 1,000 jobs in the plant.
A representative for ZF said that the company is only in discussions with Punch.
In May, the Detroit, Mich.-based automaker began a strategic review of the facility and hired Barclays Plc to find potential buyers, while exploring other options to keep it operational.
Last month, GM announced that its losses in Europe could reach $1.8bn for the year, and has a three-year target to return to profitability.
The decision to sell the factory comes at a difficult time for the European auto industry with new car sales declining and auto makers dealing with overcapacity that weighs heavily on their balance sheets.