General Motors’ German unit Opel will present a business plan to the German government in coming days, responding to calls to present such a plan to obtain state guarantees, as political support for state help varies.
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“We plan to present a joint European plan from the management of Adam Opel in coming days in close consultation with General Motors Europe,” an Opel spokesman told Reuters, adding: “This plan lays out the future business model of Opel in Europe.”
The spokesman declined to say when Opel would hand in the plan or what it would contain but an unnamed industry source told the news agency the automaker planned to deliver the plan by Friday.
Opel is seeking help from the government and labour force to finance a GBP3.3bn liquidity gap to the end of 2011, a group source told Reuters on Friday.
The automaker is asking for total state guarantees for loans that would total around EUR2.6bn (US$3.27bn), with contributions in labour cost cuts from its workforce to provide the remaining EUR700m, the source said.
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By GlobalDataA government spokesman had said on Friday that the government was waiting for the plan before it would make any decisions.
Meanwhile, Germany’s ruling conservatives wrangled at the weekend over how far the government should go to rescue Opel, with some politicians arguing the carmaker should be left to fend for itself.
Michael Fuchs, an influential parliamentary leader in chancellor Angela Merkel’s Christian Democrats (CDU), said Opel’s insolvency looked unavoidable and spoke against state support, warning any German aid would wind up flowing to GM [in the US].
Baden-Wuerttemberg state premier Guenther Oettinger said state support for Opel could give the carmaker an unfair competitive advantage against other car manufacturers.
But other conservatives, especially CDU leaders in states where Opel plants are located, spoke out in favour of a rescue of Opel, which has been making cars in Germany since 1899, Reuters said.
Merkel has most recently said her government was waiting to see Opel’s plans before deciding how to help. In November she had said the government was ready to guarantee loans.
Finance Minister Peer Steinbrueck, a leader in the Social Democrats (SPD) who share power with Merkel’s CDU, told ARD TV he would rather see the state rescue Opel than let it fail.
“We’re talking about 25,000 to 26,000 workers and their families,” said Steinbrueck, from North Rhine-Westphalia.
“Even if you discount the families, which is cynical enough, then these people who lose their jobs will cost the state – that’s me and you as taxpayers – EUR2-3bn. Doesn’t it make more sense to help them keep their jobs?”
“If the state helps Opel now, then it will have to help BMW tomorrow, and then Daimler the next day and all the car parts suppliers,” said Hans-Olaf Henkel, a former president of the German BDI industry federation and IBM Europe chief executive.
“And overnight, before we even noticed what hit us, we will have brought back communist East Germany,” he told German radio, according to Reuters.
Fuchs told the Berliner Zeitung newspaper: “An insolvency at Opel cannot be avoided. The state should not try to prevent an insolvency with loans. The funds would end up in the United States. We cannot vote to support anything like that.”
