One of the most arduous and seemingly procrastinatory transactions in history has culminated in a shocking u-turn on the part of the seller. GM has decided that it doesn't fancy selling Opel and Vauxhall after all. Oh well.
The story is still unfolding as we write (4th November 2009), with the dust settling on a situation that's perhaps not as clear-cut as GM would like to think. In a statement, GM CEO Fritz Henderson confirmed that owing to an 'improved business environment in Europe... the GM Board of Directors has decided to retain Opel and will initiate a restructuring of its European operations in earnest.'
As yet there's no official reaction from Magna or Sberbank, the Canadian car parts maker and Russian backer that looked certain to buy GM together - but the German Government is absolutely fuming. It was they, remember, that backed sale to Magna with a €1.5bn bridging loan to keep Opel afloat, in exchange for pledges that German jobs would be safe. That was much to the chagrin of both Vauxhall workers and the UK Government.
German Economy Minister Rainer Bruederle has sternly promised that Germany will "get back taxpayers' money" because "the behaviour of General Motors towards Germany is totally unacceptable." Nearly half of Opel/Vauxhall's 55,000-strong workforce is based in Germany, and walkouts in protest are already planned.
In the UK, where trade union Unite had brokered a deal with Magna to limit job losses from Vauxhall's 5,500 employees to just 600, the mood is one of muted optimism. Unite leader Tony Woodley called GM's decision "fantastic," despite once again being in the dark about just how many job cuts there will be across the Luton and Ellesmere Port factories.
That's assuming GM is actually allowed to renege on the Magna deal, though. When GM was put into administration in America, ownership of its European arm was transferred to a trust comprising two GM board members, two German Government ministers and an independent, essentially protecting it from bankruptcy. Legally, it is believed the trust must have the final say on the deal, and given the reaction in Germany, it may not be as simple as GM's 'we reckon we'll keep Opel, thanks very much' declaration. Time will tell.
Mark Nichol - 3 Nov 2009
