A threat by Volkswagen to remove business from supplier Magna International if it is successful in its bid for Opel was branded as ‘tantamount to blackmail’ by Opel labour leader Klaus Franz.


VW CEO Martin Winterkorn said on Friday that VW viewed Magna’s Opel bid with suspicion and would reconsider doing business on complex components with the supplier.


“The threat not to award Magna with contracts is tantamount to blackmail,” Franz said.”Whoever says a rescue of Opel through Magna poses a competitive disadvantage is hoping for the downfall of Opel in order to gain an edge for himself and reduce his own overcapacities at the cost of Opel,” he said.


Franz said VW has enjoyed state support for decades because VW’s home state of Lower Saxony has a 20% stake in the Wolfsburg-based carmaker.


Magna has made repeated assurances to cleanly separate its supplier operations with any automotive operations.


Ford Motor Co, whose German-based European unit is also a close rival to Opel, is not worried about Magna winning control of Opel.


“We’ve had discussions with Magna about ensuring the appropriate safeguards for our intellectual property,” Ford’s CFO Lewis Booth said earlier this month. “We’ll work with Magna to make sure we mitigate any ramifications.”


Analysts have been sceptical whether VW really would pull business away from Magna, since VW is the biggest customer of Faurecia, a major European supplier that is majority owned by French carmaker PSA/Peugeot-Citroen.


Magna International‘s Magna Steyr unit in Austria manufactures the BMW X3, Mercedes-Benz G class, Chrysler 300C, Jeep Commander and Grand Cherokee for three different customers.


It will even expand production in the future to include making the Rapide four-door coupe for Aston Martin and the Boxster/Cayman line for Porsche, indicating that it has successfully managed to convince carmakers that technology developed in tandem does not leak to other carmakers.