General Motors' Opel managers will present a business plan next Wednesday to the unit's board that will likely involve closing two plants in Europe to reduce manufacturing capacity by some 30 per cent.

'GM has been saying repeatedly that, with excess capacity equivalent to 500,000 cars annually, we have two plants too many and the new head of manufacturing has been visiting one site after the other, playing them off against each other,' said one supervisory board member from the labour side.

'We know the main points of the business plan that may be presented on Wednesday, and it foresees plant closures and no growth of the company,' the board member added. 'If it's put to a vote, then the entire labour bloc will vote against this plan.'

A GM spokesman repeated the US carmaker's previous statement that executives are working closely with the unions and works council to improve profits.

A person at the company added the management's room for compromise was increasingly limited by extremely harsh market conditions on the continent.

'Business in Europe is pretty dire for the industry overall at the moment and there's no end in sight,' the company source said.-Reuters