Twelve hours of talks over the future of Opel ended last night in Berlin without a deal and the Germans blaming the US for the hiatus.
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Government ministers told Reuters that a bidding battle for Opel had narrowed to a two-way race between Fiat and Magna though there were suggestions a late bid from China could still make the running if firmed up in time.
Ministers reportedly blamed GM and the US 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 US Treasury and expect answers by Friday and we will need these answers in order to agree a plan,” economy minister Karl-Theodor zu Guttenberg told Reuters.
“We don’t have the security yet that we need to commit to bridge financing today.”
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By GlobalDataParent GM in the US is expected to file for Chapter 11 bankruptcy protection within days, while choosing a final bidder for Opel and agreeing a deal could take months, so the German government will provide a EUR1.5bn (US$2.1bn aid package on condition the US government and GM agree to its plan to temporarily place Opel assets in a trust, a move that would protect its patents and technology from GM creditors, the report said.
Finance minister Peer Steinbrueck told Reuters he was hopeful a deal could be reached on Friday that would save Opel.
But he spoke of “surprises and disappointment” with the US negotiators, saying GM had shocked participants by announcing it needed EUR300m in additional short-term cash.
Roland Koch, premier of Opel’s home state of Hesse, 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 US Treasury.”
Guttenberg said insolvency remained an option for Opel if US negotiators refused to budge.
GM has the final say on who buys Opel but Germany is playing a major role in the sale process because it is being asked to make billions of euros worth of loan guarantees as part of any deal.
The haggling in Germany is being watched nervously here in the UK where 5,000 direct jobs at two Vauxhall plants hang in the balance. Ellesmere Port has been assigned the redesigned Astra going into production in autumn but the Luton van plant has contracts only as far as 2012.
The UK government’s business secretary Lord Mandelson last night acknowledged on Sky News that UK jobs could be lost as part of the restructuring.
He held talks with the main bidders about their commitment to continued production in the UK and offered to consider “financial underwriting” of any new arrangements.
But he told the broadcaster the GM Europe workforce as a whole could be reduced in future as part of a “consolidation” of the firm’s production capacity.
There are fears the German government could give in to election-year pressure with a pledge to protect domestic jobs at the expense of those in the UK.
