GM hits the brakes on Opel deal

[BBDOS CV8]

Originally Posted by SimonDavid

There's alot of EU politics in this.

Germany has become more nationalistic under Merkel, for the first time basically since WW2 France and Germany have leaders who dont much care for each other. Remember Merkel is from Eastern Germany, she's not a Rhineland Francophile.

Germany refused to launch a stimulus program during the financial meltdown, saying the other EU countries needed to get their own houses in order. They have a growing strategic interest in Russia which supplies most of their energy. Opel is a further development of "Germany comes first".
Given that everyone else is broke there's not much they can do about it. The EU is trying to slap them on the wrist but Germany can rightly turn around and say "we provide most of the EU's funding, dont bite the hand..."

Germany is doing exactly what the US administration is doing when it ordered GM to oust Waggoner and kill off the North American brands with no future.

If you don't want policitians to become political, don't involve them.

GM went to the German Government - it didn't want to buy in at all.

There's no increased German Nationalism or sabre-rattling. The government would rather not be involved in any way, except that by letting the Opel house of cards fold there would be losses incurrred by workers, investors and creditors of Opel - plus the funds EU would have been giving it over the years by way of subsidies.

All you guys keep going on about somehow 'American GM' are being disadvantaged by what is going on in Europe, and being dudded by Germans, Russians, whoever. If GM hadn't ridden Opel into the ground this wouldn't have happened.

Opel is now like GM North America with good new releases. But they may not be enough to make up for decades of malaise - and like the US a hell of a lot of bad perception to turn around.

[Greg Burr]

Originally Posted by YupYupYup

There is more here than meets the eye...I said all along that Opel was just a show for the auto task force...But Lutz and Co. really did not want to part with it...Just look at the product pipeline that is being used for other GM brands...

Keep it!

Agreed!

[Dr. Show-Me]

With world-wide auto sales down, the weak players fail. GM and Chrysler failed in North America, and Opel has lost lots of money. Without politics involved, it simply would have gone out of business, reducing part of the auto production excess. The European players want the jobs for their workers not for their competitors. I'm sure Volkswagen would like to see Opel just go away.

[seeg]

Originally Posted by Dr. Show-Me

With world-wide auto sales down, the weak players fail. GM and Chrysler failed in North America, and Opel has lost lots of money. Without politics involved, it simply would have gone out of business, reducing part of the auto production excess. The European players want the jobs for their workers not for their competitors. I'm sure Volkswagen would like to see Opel just go away.

Opel's sales are growing and it's market share is even increasing. The problem is costs. All that's needed is a cost reduction program and some strategic downsizing.

[Bravada]

Another issue why GM might want to wait is the reshuffling of the German cabinet after September's elections. While Merkel remains chancellor, her coalition partner is now not the large socialist SPD, but the smaller, liberal FDP. FDP has seen perhaps the greatest rise in popularity in decades in the latest election, and is a natural partner for Merkel's CDU in pursuing a more conservative, pro-market policy.

The abovementioned zu Guttenberg was now moved to the Defense post, and replaced by a seasoned FDP economist. Another seasoned politician, CDU's Wolfgang Schauble, took over as the Finance Minister. It does indeed seem there will be quite a bit of change in the government's political stance, there was already a message from Guido Westerwelle, leader of FDP and the new Foreign Minister, that he wants to revive the Weimar Triangle of Germany, France and Poland, which might be an attempt to balance out the previous German-Russian amicability.

[rueben44]

Originally Posted by BBDOS CV8

Germany is doing exactly what the US administration is doing when it ordered GM to oust Waggoner and kill off the North American brands with no future.

If you don't want policitians to become political, don't involve them.

GM went to the German Government - it didn't want to buy in at all.

There's no increased German Nationalism or sabre-rattling. The government would rather not be involved in any way, except that by letting the Opel house of cards fold there would be losses incurrred by workers, investors and creditors of Opel - plus the funds EU would have been giving it over the years by way of subsidies.

All you guys keep going on about somehow 'American GM' are being disadvantaged by what is going on in Europe, and being dudded by Germans, Russians, whoever. If GM hadn't ridden Opel into the ground this wouldn't have happened.

Opel is now like GM North America with good new releases. But they may not be enough to make up for decades of malaise - and like the US a hell of a lot of bad perception to turn around.

I agree with you on everything but the last part of your post. Opel is not run into the ground and they make better products now than they ever have. In addition they bucked the world wide recession and increased in sales. The problem with Opel is the cost of operating in some parts of Europe. That cost is eating up the company's profits.
and if they found a way to break some of those fat contracts they would be A ok.

[Burnout Czar]

Originally Posted by BBDOS CV8

Germany is doing exactly what the US administration is doing when it ordered GM to oust Waggoner and kill off the North American brands with no future.

If you don't want policitians to become political, don't involve them.

GM went to the German Government - it didn't want to buy in at all.

There's no increased German Nationalism or sabre-rattling. The government would rather not be involved in any way, except that by letting the Opel house of cards fold there would be losses incurrred by workers, investors and creditors of Opel - plus the funds EU would have been giving it over the years by way of subsidies.

All you guys keep going on about somehow 'American GM' are being disadvantaged by what is going on in Europe, and being dudded by Germans, Russians, whoever. If GM hadn't ridden Opel into the ground this wouldn't have happened.

Opel is now like GM North America with good new releases. But they may not be enough to make up for decades of malaise - and like the US a hell of a lot of bad perception to turn around.

I think the problem is the High German labor rate/benefit package, too much time off, and an overall uncompetitive economic situation in Europe. Also toss in a piss poor German attitude of superiority over everyone else. Despite what Europeans and other people in the world believe the respective company does not exist to provide it's workers a living, it exists to make a profit.

[chinamonty]

It exists to turn labour hours plus $s into more $s at a profit. If the people providing the Labour hours aren't happy then the $s won't turn themselves into more $s by themselves. It is a two way street.