EU-DIGEST

German officials denied Monday that they were trying to outbid other European nations in offering money to General Motors Co. to save local jobs.
GM's European executives are meeting with ministers from Germany, Britain, Belgium, Spain and Poland as well as European Union commissioners in Brussels to discuss how the company plans to cut capacity by 20 to 25 percent -- and likely shed thousands of jobs. Germany's deputy economy minister Jochen Homann said Germany "will not participate in a subsidy race" as other countries hint that they are willing to help the company pay the costs of restructuring the Adam Opel GmbH and Vauxhall units.

Labels: Automotive Industry, Economy, EU, Germany, GM, Opel

The small German town of Ruesselheim has not been happy with General Motors. Since GM's announcement that it would restructure German subsidiary Opel itself, rather than sell it off, Ruesselheim has been home to angry protesters calling GM's behavior "totally unacceptable" and "the ugly face of turbo-capitalism." In a move that may appease some of that anger, a GM spokesman announced Saturday it will move its European headquarters from the Swiss capital Zurich to Ruesselheim, Opel's current home. All but the headquarters of the Chevrolet brand will be included in the transfer, which should be completed before the end of the year, the spokesman said.

Labels: Automotive Industry, EU, Germany, GM, Opel

A senior German government official told General Motors Co. executives Wednesday that the U.S. automaker will have to cover the cost of restructuring its troubled German carmaker Adam Opel GmbH. Economy Minister Rainer Bruederle said he reiterated the position outlined by Chancellor Angela Merkel at a meeting in Berlin with Nick Reilly, GM's head of international operations, and John Smith, the chief negotiator in the Opel bid talks. Merkel told the lower house of Parliament on Tuesday that GM would have to rely on its own resources to restructure Opel. Mrs.Merkel said: "This solution can only work if GM takes over the lion's share of the restructuring costs, which also means that it has to pay back the bridging loan."

Note EU-Digest: If GM management continues dragging their feet and keeps coming back on its word, the next step should be for Germany to consider nationalizing Opel and continue with the original plan whereby Opel would be sold to Canadian and Russian interests to guarantee continued operations of Opel and German jobs.

Labels: Automotive Industry, EU, Germany, GM, Opel, US

The directors of General Motors met for dinner last Monday in advance of an eagerly anticipated board meeting the following day. It was a chance for them to get to know one another. There wasn’t much time for chit-chat. New or not, the board had to make a historic decision — whether to cut GM’s ties with Europe, and its claim to be a global car company, by selling Opel and Vauxhall. Henderson made no firm recommendation. After all, the board had approved the deal in principle and was expected to give the green light. Except it didn’t. Immediately after the meeting, GM announced that it would keep Opel / Vauxhall, saying the business was now judged vital to product and technology development strategy. The decision provoked fury in Germany, where the Magna plan had been supported because it promised fewer job losses. Henderson had to call Angela Merkel, the German chancellor, with the news — she was in Washington to see President Barack Obama.

The workforce of Opel in Germany, some 25,000, took to the streets within 48 hours. “The strikes beginning in Germany will be repeated across Europe,” said Klaus Franz, head of the Opel works council in Germany. “The next move from General Motors will be to blackmail the governments and employees of Europe to finance their unworkable plans for restructuring Opel.” Others joined the attack. “This behaviour of General Motors shows the ugly face of unbridled capitalism,” said Jürgen Rüttgers, governor of North Rhine Westphalia and a leading figure in the German government. The Opel factory at Bochum, in his state, is high on the list of possible closures with the loss of 5,000 jobs. Germany’s bestselling newspaper, Bild Zeitung, described GM as “bullshitters”.

Note EU-Digest: Why doesn't the German Government nationalize Opel?TGm should not be able to get away with this.

Labels: Economy, EU, Germany, Opel

Opel workers plan to pressure General Motors Co. into accepting an offer to sell a majority stake to a group led by Canada’s Magna International Inc., a labor representative on the unit’s supervisory board said. “The parent needs to understand that there’s no going back,” Armin Schild, an official with the IG Metall union, said today in an e-mail. “Neither the continuation of the waiting game aimed at the unit’s insolvency nor a return to ‘un-independence’ will be accepted without opposition.” GM’s advisers are recommending that the board consider spurning a German-government backed sale of Opel in order to retain a bigger presence in Europe and Russia, a person familiar with the discussions said. The advisers suggest GM seek aid from other European countries to retain ownership of the division as an alternative to surrendering control, the person said. GM’s new board, dominated by members appointed after the Obama administration forced the company into bankruptcy, is questioning the decision made by previous directors to give up control of Opel.

Labels: EU, Germany, Nile Virus, Opel, Refugees, Social Alcohol Consumption

German Blast GM For Delaying Opel Deal

German Economy Minister Karl-Theodor zu Guttenberg said he believed a deal was still possible and that talks would continue, but there were angry words from around the country where the carmaker has plants employing some 25,000. Juergen Ruettgers, premier of North Rhine-Westphalia, Germany's most populous state and home to the Bochum works, issued a statement saying the delay was "intolerable." "The United States government now shares responsibility for finding a way past GM's leadership weakness and helping us finally to reach a sustainable decision," he said. The German government, which is barely a month away from a federal election, has offered financial backing for Magna's bid because it believes it would be the best option to save jobs. Roland Koch, conservative state premier of Hesse, where Opel is based, said he was "extremely annoyed," by Friday's outcome. "All the relevant questions have been resolved between GM and Magna," he said. "There's absolutely no justification for this postponement."

Labels: EU, Germany, GM, Opel

Berlin calls for higher bids for GM Europe - by Sarah Arnott

Both suitors in the running for GM Europe will have to up their bids to win the support of the German government, economy minister Karl-Theodor zu Guttenberg said yesterday. A GM board meeting in the US this week is a key step in the battle for the group’s European arm, which includes Opel in Germany and Vauxhall in the UK. The parent company is understood to prefer the offer from RHJ International, a private equity group, to that from preferred bidder, Canadian car parts maker Magna, backed by Russia’s state-owned Sberbank. After its initial lead, the Magna deal has struggled because of disagreements over intellectual property issues and plans to seel into the Russian market. But German states and federal government - which will stump up cash to lubricate the deal and have a strong voice in the talks – lean towards Magna’s plan as less likely to cost local jobs.

Labels: Automotive Industry, EU, Germany, Opel

Opel's Future Thrown into Uncertainty

here can be no winner in the dispute between Canada’s Magna and Belgium’s RHJ International for Germany’s automotive giant Opel. If the talks between the General Motors and the bidders end with no results, the car-maker may go bankrupt, Germany's Frankfurter Allegemeine Zeitung newspaper wrote. “There are still lots of question marks: for example the bidders have to ensure that the new Opel company can start with a strong capital base. That means that the bidders have to be ready to take on more risk themselves. Otherwise the E.U. Commission will not accept the rescue," the minister told the newspaper.

Labels: EU, Opel

Beijing (AFP)BAIC plans Opel plant in China, Europe job cuts

BAIC plans Opel plant in China, Europe job cuts

Chinese auto maker BAIC, which is offering 922 million dollars for a majority stake in Opel, plans to build a plant in China and cut jobs in Europe if its bid succeeds, a report said. In a non-binding offer submitted last week for the German-based unit of General Motors, BAIC proposed to spend two billion dollars on what would become Opel's first factory in China, according to the Financial Times. The plant would come online in 2012 and make Opel models specifically geared towards the China market. In addition, BAIC would use Opel's German plants to export to China, the London-based newspaper said.

The Chinese auto maker also planned to shut down General Motors' Antwerp plant in Belgium and cut Opel's workforce across Europe, the report said, citing unnamed sources close to the matter.

Labels: Automotive Industry, China, EU, Germany, Opel

German Economy Minister says Opel deal still hangs in balance - by Sarabjit Heera

According to the German newspaper Westdeutsche Allgemeine Zeitung (WAZ), the Economy Minister of the country has said that the decision pertaining to finalizing a bid for the German carmaker Opel still hangs in balance. Going by a Monday statement in the paper, Karl-Theodor zu Guttenberg has said: “I acknowledge Magna's ambitious goal, wanting to sign a contract by mid July. However, there still seem to be some unanswered questions.” Guttenberg added that as per the phase at present, “everyone is free to place offers.” Guttenberg’s comments apparently cam in response to a statement by the General Motors’ Europe President Carl-Peter Forster, who informed another German newspaper that, very soon, he expects selling Opel to the Canadian auto parts supplier Magna.

Labels: Automotive Industry, EU, Germany, Opel

Germany Set to Deepen Ties to Russia With Opel Sale - by Leon Mangasarian

Chancellor Angela Merkel’s government picked on May 30 a partnership led by Magna International Inc., a Canadian auto- parts supplier, with Russia’s biggest bank, OAO Sberbank, and Russian carmaker OAO GAZ as the sole bidder for Opel, the European division of GM, the U.S. automaker that will file for bankruptcy today. “This will fuel suspicion in east Europe over Germany and Russia and why the biggest economy in Europe has tied up with strange Russian tycoons to please the Kremlin,” said Fredrik Erixon, director of the Brussels-based European Centre for International Political Economy. “Germany is playing off the Poles and the Baltic states against Russia.” Germany is Russia’s biggest trade partner, a relationship underpinned by rising German gas and oil imports. Annual German trade with Russia increased five-fold to 68.2 billion euros ($96.2 billion) last year since 2000. With 6,000 German companies operating in Russia, business leaders in Berlin view the global recession as a speed-bump, with manufacturers set to win contracts as Russia diversifies from energy and rebuilds transport and health care.

Labels: EU, Germany, Opel, Russia

Germany picks Magna to save Opel

Germany has agreed a deal with Magna International, a Canadian car parts maker, to take over Opel, part of the European wing of US carmaker GM. German Finance Minister Peer Steinbrueck told journalists outside the chancellery shortly after 0200 local time on Saturday morning that a deal had been agreed. The German government is expected to provide an immediate loan facility of 1.5bn euros ($2.1bn, £1.3bn). The Magna deal should protect Opel if GM files for bankruptcy protection in the US on Monday, as is expected. The Canadian company has said it will put more than 500m euros ($700m; £435m) into Opel, which employs more than 25,000 people in Germany.Before the announcement of the deal, Magna said it planned to cut 2,500 jobs in Germany, about 10% of Opel's workforce in that country. Italy's Fiat, a former potential bidder, had said it would cut 10,000 jobs. GM operations in Europe will now be placed under the care of a trustee to shield them from the parent company's filing for bankruptcy protection in the US. By doing this the Germans have ringfenced Opel from the mother company and this has been achieved.

On Friday, a court in Sweden granted Saab, GM's other European business, an extension to its protection from creditors. The Swedish car maker first sought protection in February. It now has until 20 August to line up a new owner and to restructure its business. Saab is being sold off by GM separately.

Labels: EU, General Motors, Germany, Opel

Germany blames U.S. for scuttling deal on Opel

Reuters reported that the fate of German car maker Opel hung in the balance on Thursday after marathon talks on shielding it from the looming bankruptcy of its U.S. parent General Motors ended without a deal. German ministers told reporters after more than 12 hours of negotiations in Berlin that a bidding battle for Opel had narrowed to a two-way race between Italian car maker Fiat and Canadian auto parts company Magna.

The Germans blamed GM and the U.S. Treasury for the failure to agree a plan to tide Opel over until a deal with one of those suitors can be sealed. "We have made demands on the U.S. Treasury and expect answers by Friday and we will need these answers in order to agree a plan," Economy Minister Karl-Theodor zu Guttenberg said.

Finance Minister Peer Steinbrueck said he was hopeful a deal could be reached on Friday that would save Opel. But he spoke of "surprises and disappointment" with the U.S. negotiators, saying GM had shocked participants by announcing it needed 300 million euros in additional short-term cash. Roland Koch, premier of the state of Hesse where Opel is based, added: "I think we can say clearly that a big part of the problems tonight came from the combination of new figures from General Motors and a not very helpful negotiating stance from the Americans, from the U.S. Treasury." Guttenberg said insolvency remained an option for Opel if U.S. negotiators refused to budge.

Labels: Automotive Industry, EU, Germany, GM, Opel, US

Germany Seeks to Wean Opel From GM After 80 Years - by Andreas Cremer and Tony Czuczka

The German government aims to wean General Motors Corp.’s Opel unit from its U.S. parent after an 80-year association, insulating the European carmaker from a GM bankruptcy while buying time for negotiations with investors. Talks on securing Opel’s future hosted by Chancellor Angela Merkel in Berlin later today won’t “decide everything” and may not result in a preferred bidder, government spokesman Thomas Steg said in Berlin. Efforts will focus on forging an agreement with U.S. and GM officials to place Opel in a trust that would receive 1.5 billion euros ($2.1 billion) in loans, Steg said. “Naturally it’s attractive for the investors if Opel is kept alive,” Peter Bosch, an auto analyst at Oliver Wyman Consulting in Munich, said by phone today. “And it’s attractive for the government because it allows time for negotiations that can be conducted in peace to get the best result for Opel.”

Labels: Automotive Industry, EU, Germany, Opel

Opel returning to European Ownership - Magna, Sberbank team up in Opel bidd

Canadian auto parts maker Magna International Inc. says it is joining forces with Russia's biggest lender, Sberbank, in a bid to take a majority stake in General Motors Corp.'s Opel unit.In a statement released late Friday, Aurora, Ontario-based Magna for the first time offered details of its bid, one of three from companies interested in Opel. Magna and Sberbank propose to invest a total of euro700 million ($977 million) in Opel, based in Ruesselsheim, Germany. An unspecified portion of that would be guaranteed by the German government, the statement said. A possible deal would leave Magna with 20 percent of Opel and state-controlled Sberbank with 35 percent, while parent GM would retain 35 percent and 10 percent would go to Opel employees, it added.

Labels: Automotive Industry, EU, Opel

Opel electric Car available 2011

For the complete report from BusinessWeek click on this link

Europe's Chevy Volt - by Paul Evans

Electric Car - Europe's Chevy Volt - by Paul Evans

After various sneak peeks and spy shots, we now have official pictures of the European version of the Chevrolet Volt. To be officially launched at the 2009 Geneva Motor Show, the left hand drive Opel/Vauxhall Ampera will go on sale late 2011 with a right-hand drive Vauxhall version available in 2012.

Labels: Auto Industry, Electric Car, EU, GM, Opel