February 9, 2010
Germans against offering aid to GM-owned Opel
Published: 8 Nov 09 11:16 CET
Online: http://www.thelocal.de/money/20091108-23103.html
After last week’s shock decision by General Motors to hold onto Opel rather than selling it to the Canadian company Magna, a new poll shows that a clear majority of Germans against offering aid to the company if it asks for state aid.
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GM is highly likely to ask Germany, as well as other European countries where Opel facilities are located, to help pay for the company’s reinvention, though the political winds in Germany in particular are blowing against it.
When news of GM’s decision broke last week, the newly sworn-in Economy Minister Rainer Brüderle said the move was “totally unacceptable” and has since said he is sceptical that Germany will offer additional assistance.
Opel is currently operating in a trusteeship set up by the German government in spring to help facilitate a quick sale to another company. The government also extended a €1.5 billion line of credit to keep the company solvent through the process.
Brüderle and many other German politicians have demanded that GM repay the credit - initially due to be repaid by the end of November - immediately now that it has decided to hold onto Opel.
GM’s restructuring plans are said to be similar to the one put forward by Magna and will entail approximately 10,000 layoffs throughout Europe out of a workforce of approximately 50,000. Unlike the Magna plan, which to satisfy the German government proposed closing none of Opel’s German facilities, GM is thought to plan the closure of at least one German site.
DPA/The Local (news@thelocal.de)
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Your comments about this article:
There are just two ways to make sure the money stays with Opel:
1) Have the government audit every single transaction between Opel and GMNA. That means check the price of every little brake caliper, light switch or control arm design Opel buys from GMNA (and vice versa).
2) Have two separate companies.
If GM tells Opel 'we'll be paying you $3M for this front control arm design', how would the German government determine whether that's a fair price or whether it's actually worth $10M and GM just quietly pulled $7M out of Opel?