Gm Crisis Meeting Today


German Finance Minister Wolfgang Schäuble said yesterday that the Merkel government was seeking clarity from General Motors on plans for Opel.

This came on the eve of today’s meeting in Brussels between EU Industry Commissioner Günter Verheugen, European economy ministers and representatives of GM to discuss the future of the US car maker’s European business.

GM has said it plans to release full ‘restructuring in earnest’ plans for the Opel and Vauxhall operations in December.

GM Europe released a statement on Thursday in response to a ‘misrepresentation’ by the daily Frankfurter Allgemeine Zeitung (FAZ).

FAZ had claimed that GM would want to maintain all of their European plants. What the company had said was they have to reduce capacity by 20 to 25 per cent but there are ‘multiple ways of reducing structural cost,’ and expect to provide details in the near future.

‘Our plan is very similar to Magna’s. I don’t think it’s worse,’ Nick Reilly, interim head of GM’s European business, told reporters in northern Spain.

The Magna plan was to axe 10,000 jobs in Europe, and was expected to include the closure of the UK’s Luton plant in 2012, as well as axing 800 jobs at Ellesmere Port and Luton.

Germany’s Schäuble said yesterday: ‘My position is totally clear. It is now down to General Motors to provide clarity on how they are going to live up to their corporate responsibilities.

‘We’ve heard recently from Detroit that GM does not need any state aid for Opel. All I can say to that is: so much the better.’

Germany is home to around 25,000 Opel workers, around half the total European workforce.

Germany had stumped up several billion euros in aid to secure the Magna deal as it believed it was the solution most likely to safeguard German jobs.

Meanwhile, the German press has reported a bidding war has already broken out between European countries in a bid to secure jobs in their own countries.

GM Europe is said to have received offers of 400 million euros ($600 million) from the UK and between 300 million and 400 million euros from Spain.

Poland is said to have offered tax breaks.

In response to the auction EU Industry Commissioner Verheugen said he found the offers ‘alarming’.

GM Europe’s Reilly said there was no ‘bidding war’ but he added that ‘if a country refuses to participate (in the funding), it could influence the plan somewhat’.