Opel rescue raises hopes, but Merkel warns of challenges

Source: AFP

BERLIN (AFP) – German auto-workers expressed relief Saturday after a dramatic deal to save car maker Opel, but Chancellor Angela Merkel warned of a bumpy ride ahead with the industry in turmoil worldwide.

The deal, struck in the early hours of Saturday after marathon talks, sees Canadian parts maker Magna and its Russian backers taking over Opel as its parent company General Motors prepares to file for insolvency.

But while Germany's 25,000 Opel workers cheered the deal, Merkel -- who faces a general election in four months -- underlined the scale of the challenge facing the reborn company and its employees.

"For Opel and Magna, the work is now just beginning and there are several difficulties still to overcome," she told reporters.

Read more: http://news.yahoo.com/s/afp/20090530/ts_afp/autocompanygermanyusrussiaopelmagnagm7th_20090530194104

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The article went on to quote one expert as saying there is a 60 to 70% chance the Opel/Magna relationship won't work and another saying Opel will be insolvent in 2 to 3 years.