By Richard Milne and Daniel Schäfer
Published: November 4 2009 13:16 | Last updated: November 4 2009 22:31
Germany and Russia reacted furiously to General Motors’ surprise decision to keep Opel rather than sell it, throwing up fresh uncertainty about the future direction of one of Europe’s biggest carmakers.
The news that GM’s board had abandoned the sale of Opel/Vauxhall to Canada’s Magna and Russia’s Sberbank also led to a schism among the carmaker’s workers, with UK employees celebrating while Germans said they would start warning strikes on Thursday.
Jürgen Rüttgers, premier of North Rhine-Westphalia state, where GM proposes closing a factory, said: “General Motors’ behaviour shows the ugly face of turbo-capitalism. That is completely unacceptable.”
GM’s decision pitches the Detroit-based company into a new confrontation with the German government over Opel. At the heart of the controversy is whether Berlin would allow Opel to go bankrupt or step in to support GM financially.
GM said that it would need about €3bn in financing to restructure Opel and that it would ask European governments for money. But Berlin, which was offering Magna €4.5bn ($6.6bn) in state aid, is instead asking GM to pay back a €1.5bn bridging loan it gave to the US carmaker. GM said it had paid back €600m and was willing to repay the rest.
Rainer Brüderle, Germany’s new economics minister, said: “The behaviour of General Motors towards Germany is totally unacceptable.” However, some state governments in Germany with Opel factories hinted they could support GM’s move.
People close to GM admitted there was a “certain kind of brinkmanship” involved in its decision to retain Opel.
“If GM cannot finance it, then they will go for a controlled insolvency with a much more brutal restructuring and even more plant closures,” said one.
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http://www.ft.com/cms/s/0/18c8064a-c93e-11de-b551-00144feabdc0.html