• Government stresses Magna preference
  • Chancellor told to lobby US government to back Germany's choice

German chancellor Angela Merkel has been urged to lobby the US government to support the Magna bid for Opel because it saves jobs.

"I am operating on the assumption that Chancellor Angela Merkel will use her influence with US president Barack Obama in the interest of Opel employees," Thuringia premier Dieter Althaus told Bild am Sonntag newspaper, according to AFP. Opel's Eisanach plant is in the state.

The central government in Germany backs Magna's bid because it fears RHJ would slash jobs though a Monday report said the Canadian supplier would axe 3,000 of Opel's posts, primarily by shifting Bochum gearbox production to another country.

The Social Democratic challenger to Merkel in September's general election, vice-chancellor Frank-Walter Steinmeier, called GM chief executive Fritz Henderson Friday to underline Berlin's position, a spokeswoman confirmed to AFP on Saturday.

Hesse state premier Roland Koch told business weekly Wirtschaftswoche that US-German friction had risen as Berlin made clear that Opel could only expect state aid if Magna won the bidding war. The magazine also reported Magna's job cut plans, citing documents given to the government on 17 July.

"The tone of the talks with GM has gotten a bit more earthy," he said. "But now the German position has been understood."

Althaus said a plan in which the protection of German jobs was not taken into account was a non-starter.

"The loan guarantees from the (German) federal government and the states are available for the Magna scheme but not for that of a competitor which would put Opel's future at risk again," Althaus said.

"The only plan that foresees a future for Opel plants in Germany is Magna's."

According to AFP, economy minister Karl-Theodor zu Guttenberg in an interview with Bild am Sonntag urged both government and Magna to invest more of their own money to invest in Opel "in the interest of taxpayers".