GM Said to Be Ready to Cut About 10,000 Jobs in Europe

General Motors (GM) will cut around 10,000 jobs in Europe in a drive to save some 500 million euros ($613.4 million) a year and return its loss-making operations there to profit, a company source said on Wednesday.

"You would not be putting your head in a noose if you used that number," the source said.

An announcement would come on Thursday, he said, but there would be no details on the impact on individual plants.

GM, which last made a profit in Europe in 1999, employed around 63,000 people at 11 production and assembly plants in the region at the end of 2003.

GM Europe's loss widened in the second quarter to $45 million from $3 million a year earlier amid intense pricing pressure, adverse currency movements and restructuring costs for a joint venture with Italy's Fiat (search).

That brought its first-half loss to $161 million, up from $68 million in the same period last year. It has abandoned its original target of making a profit in Europe this year.

Its third-quarter results are due on Thursday.

GM has already reduced capacity in Europe by 28 percent from 1999 levels but has acknowledged it has to take a tougher line on cutting costs and boosting revenue.

It clipped the wings of its independence-minded European divisions in June by concentrating power at its regional headquarters in Zurich under a beefed-up management team, but stopped short then of announcing job cuts or plant closures.

Cuts at the Opel, Vauxhall and Saab units would be the latest blow to carmaking in western Europe.

Ford's luxury carmaker Jaguar is chopping 1,150 jobs in Britain in a bid to return to profit and Volkswagen (search) is trying to push through a 30 percent reduction in its German labor costs by 2011 in tough talks with unions. ($1=.8151 Euro)