Germany prepared to help Opel as GM falters

Germany prepared to help Opel as GM falters
Photo: DPA
The German government said Friday it would act quickly to help car maker Opel, which has asked for state-backed loan guarantees in the event its US parent group General Motors goes bankrupt.

“If we need a quick decision, the government is able to react very fast,” if necessary “before Christmas” on December 25, government spokesman Thomas Steg told a press conference in Berlin.

He added that “for the time being, Opel has not signalled that it is in a situation where it needs a state guarantee” to obtain crucial financing from banks.

The German magazine Auto, Motor and Sport reported that Opel workers might

be willing to take a stake in the company. It cited internal documents from the German labor union IG Metall.

The magazine said Opel staff would also agree to cost reduction measures and said the trade union documents underscored the dangers that pension contributions from workers could “disappear in the big GM pot.”

Opel asked the government a few weeks ago to back loans of more than €1 billion ($1.34 billion) if the financial situation at General Motors, its US parent company, got worse.

GM appeared to be in dire straits on Friday after a plan worth billions to rescue ailing US automakers collapsed in the US Senate, raising the prospect of imminent bankruptcy for GM and US rival Chrysler.

The works committee at General Motors Europe called the Senate vote a “catastrophe” but added that “Opel is healthy and competitive in terms of productivity, quality and product range.”

Steg, who is the deputy spokesman for German Chancellor Angela Merkel, repeated on Friday that Berlin would only help Opel if it was sure that public funds remained in Germany. Opel dealers called meanwhile for the creation of a financial support fund

by the automaker itself.

“Opel could contribute a part of each sale to this fund” and “we could thus help many colleagues who no longer have access to financing,” the magazine Automobilwoche quoted Albert Still, head of the supervisory board of the

biggest German dealership AVAG, as saying.

After the failure of the US rescue plan for autos, “it is not a storm that I expect, but a tsunami,” Still said.