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Works council officials says Opel needs European aid to survive
Photo: DPA

Works council officials says Opel needs European aid to survive

Published on: 23 Feb 2009 18:45 CET

There will not be a "isolated German solution for Opel," Klaus Franz told Deutschlandfunk radio. "If we find a solution, it will only be a European solution," he added.

Opel needs more than €3.3 billion ($4.2 billion) to stay afloat, according to media reports, as auto sales have slumped around the world, especially in Europe. The company will go bankrupt by May or June if no state aid is forthcoming, mass circulation Bild reported over the weekend.

Before considering ploughing public money into the company, Berlin has insisted the company draw up a restructuring plan, which will be presented on Friday, according to Franz.

"A decision can only take place when a restructuring plan becomes available," deputy government spokesman Thomas Steg told a regular briefing. "There can be no blank cheque."

Nevertheless, politicians have raised hopes that some public money could be made available to save tens of thousands of jobs in Germany's ailing economy. Finance Minister Peer Steinbrück told ARD public television Sunday there would be a high price to pay in terms of unemployment benefits and lost tax revenue if Opel's 25,000 employees were made redundant.

"Would it not be more logical to provide aid (to the company) so that these people can continue to earn their living?" Steinbrück asked.

Frank-Walter Steinmeier, Germany's foreign minister, appealed on Saturday for international aid for the carmaker.

"We have to look further than our own backyard. No car factory is capable of surviving alone in Germany or elsewhere," he told the daily Rheinische Post.

General Motors has opened the door to spinning-off Opel as part of a broader restructuring plan which includes laying off 47,000 workers worldwide, slashing production and closing plants.

"We are on this path," confirmed Franz.