General Motors has now repaid the last installment of the German bridging loan for Opel. The assistance given to the subsidiary of the US car maker will thus cost German tax-payers nothing. The bridging loan of 1.5 billion euros extended in June was, however, crucial in order to save Opel.
GM has decided not to sell Opel. The US corporation is thus once again fully responsible for the Opel workforce of some 25,000 in Germany. The days of the Opel Trust, founded at the end of May are now numbered. The Trust controls 65 percent of GM’s stake in Opel. This will now be returned to General Motors, which will once again become the sole proprietor of Adam-Opel GmbH.
Jobs to go – but the plants will stay open
General Motors is planning to slash up to 5,400 jobs in its efforts to restructure Opel in Germany. All plants are to stay open according to information given by the new head of GM operations in Europe Nick Reilly during talks with the German states that are home to Opel plants.
GM’s restructuring plans are "very similar” to previous strategies, declared Chancellor Angela Merkel yesterday on the fringes of her meeting with Spanish Prime Minister Jose Luis Rodriguez Zapatero. Opel and GM Europe now once again have opportunities. The Chancellor reminded her audience that it was German assistance that tided Opel and GM Europe over difficult times.
Europe against any "subsidy race”
High-ranking government representatives of the countries that are home to Opel/Vauxhall plants and the EU Commission have rejected the notion of any "subsidy race” within Europe. No country will be going it alone in offering loans or guarantees. EU competition regulations will be respected, according to EU Commissioner Günther Verheugen, speaking in Brussels.
Germany and Spain to cooperate
In the case of Opel too Germany and Spain will be cooperating. This was announced before a meeting between the Chancellor and Spanish Prime Minister Jose Luis Rodriguez Zapatero at the government guest house in Meseberg. In January Spain will take over the EU presidency.
On 3 November GM made a surprise announcement that the company would be restructuring its European operations itself. The new head of GM’s operations in Europe Nick Reilly then promised a new restructuring strategy to the Federal Economics Ministry. The focus is to be on Western Europe, and the strategy will cost 3.3 billion euros.
In her government statement on 10 November Chancellor Angela Merkel emphasised the special responsibility of General Motors for Opel. For the workforce she demanded a "concrete solution to save jobs, expertise and factories”. GM is expected to produce a "reliable strategy” and to shoulder the lion’s share of financing the reorganisation.
The Chancellor also called on the company to be equally committed to its European and American plant locations in future. A "fair balance” is, she said, the "crucial factor” in the success of the coming talks.
