GM Europe guarantees 5 plants through 2016 - union

FRANKFURT, April 29 (Reuters) - General Motors (GM.N: Quote, Profile, Research) agreed with senior labour representatives not to close five European plants or lay off 10,000 workers employed there through the end of 2016, GM Europe's works council said on Tuesday.

As part of the deal, its endangered Antwerp plant received a new lease on life after a deal was struck to build two new sport utility vehicles with planned production of 120,000 units per year that were originally planned for China, with the possibility of a third.

"The safeguarding of the Antwerp plant is a clear sign against the relocation of production to Eastern Europe and Asia," the works council said in a statement.

A spokesman for GM Europe was not immediately reachable to confirm the deal.

Some 3,000 employees are currently on staff in Antwerp, the main Astra plant at present but which last April lost a bid to build the next generation of GM Europe's best-selling compact to plants in Germany and the UK, among others.

Management had admitted at the time that neither per-unit costs nor productivity were the deciding factor since these were all roughly the same among its competing western European plants. Instead, strategic issues weighed heavily, such as the fact that Germany and the UK are GM Europe's two biggest markets.

Originally this would have led to a third of the plant's workforce, about 1,400 jobs, being cut.

GM Europe labour leader Klaus Franz said it was unclear how many of the Antwerp jobs would be ultimately eliminated, but he reaffirmed that any cuts to come in 2011 when it stops Astra production would be either through early retirement or natural attrition.

The deal also serves as a much-needed boon to Belgium's struggling automotive industry, which suffered a huge scare when Volkswagen (VOWG.DE: Quote, Profile, Research) threatened to cut over 3,000 jobs at its Golf plant in Brussels.