In a strange turn of events (though some might rightfully disagree....), GM today announced that the company's Board of Directors decided to terminate the sale process of Opel to a Russian-backed group led by Magna and keep the European unit under its control. The U.S. automaker said that it took this decision because of an "improving business environment for GM over the past few months" as well as the importance of the Opel/Vauxhall brands to the firm's global strategy.GM's president and CEO Fritz Henderson said in a prepared statement that the company will present its restructuring plan for its European division to Germany and other governments and hopes for its favorable consideration. The U.S. automaker anticipates that the restructuring of Opel will cost around €3 billion, or about $4.4 billion at today's exchange rates.
"While strained, the business environment in Europe has improved." Henderson said. "At the same time, GM's overall financial health and stability have improved significantly over the past few months, giving us confidence that the European business can be successfully restructured. We are grateful for the hard work of the German and other EU governments in navigating this difficult economic period. We're also appreciative of the effort put forward by Magna and its partners in Russia in trying to reach an equitable agreement."
Siegfried Wolf, Magna's Co-Chief Executive Officer stated: "We understand that the Board concluded that it was in GM's best interests to retain Opel, which plays an important role within GM's global organization. We will continue to support Opel and GM in the challenges ahead and wish to thank everyone who supported the Opel restructuring process for their tireless efforts and dedication over the past several months."
So, what do you think about GM's decision to retain Opel and ditch Magna and it's Russian financers, will it be beneficial for both parties in the long run? Let us know what you think by leaving us a comment after the jump.
16 Comments:
GM will eventually sell Opel as GM will fail (again). I am not wishing this on GM, but GM still retained the bulk of their old upper management, and GM will be doomed to repeat history. I only hope this time that the US taxpayers will not be further burdened with GM failures, but I doubt it.
I think GM is not going to retain what they had back then. And I don't think Opel can help GM or GM can help Opel.
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-Monday, October 26, 2009
Did spies steal GM secrets for rival?
-GM Daewoo files car 'copying' action against TagAZ
-More Delay for Sale of GM's Opel
October 23, 2009
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Here is what I had posted in my blog "Wheelsman" AFTER READING the above lines in the news:
--Hey, these things been happening for the last 2 centuries... Nothing New. BUT particularly this news, at this very time sounds very much
like a "1st phase of raising publicity" on a strong attempt of STOPPING the (potential) sale of OPEL to Magna Int. partnered with the RUSSIAN Sberbank. EU is already facing difficulties to carry on with this transaction... Some folks out there could be utilizing this delay to trigger an awareness among the public of the presence of a Russian investment within the scheme so that the sale falls thru and 1) Russians are STOPPED 2)GM gets to keep OPEL 3)GM falls short of getting the cash and keep on ailing(competitors wld luv that). Think about it..!
Also GM may be seeking the option 2 here with a well designed plan; if thats the case, I fully support it..../MT-- u may check it out @
http://wheelsman.blogspot.com/2009/10/did-spies-steal-gm-secrets-for-rival.html
I hope they have made the right decision. I hope this means that Australia may get back its Astra rather than the less impressive Daewoo Cruze
GM may not survive, but without Opel, how can they even try to compete in Europe? Love GM or hate them, not selling Opel is best for GM.
Best decision GM's made in a long time. Let's just hope they can be coherent in their decision-making and implement good policies.
From a global product perspective, Opel is the only GM division that seems to keep up with modern trends in design, packaging, materials and engineering providing GM's other subdivisions with globally competitive products.
There seem to be two great forces at odds at GM: one that pulls toward modern design and engineering philosophies and another pulling towards the status quo of so-called proven technology combined with traditional packaging and taking the easy way out hoping for wider profit margins even if they are short-lived.
Chevy's lineup is made up of some Opel-based products while at the same time it's banking on SUVs -- oops, I mean "crossovers" -- yet no new small cars --much less exciting new cars.
Sure there's a new Daewoo-based small hatch coming out, and the Astra-based and decontented / cheaper Cruze taht offer little to no appeal, at least in my view and hopefully for GM I will be wrong.
There is no 3-series size competitor on offer from Cadillac; nothing that competes with the A4 either. GM tried on the cheap with the Opel-Vectra-based SAAB 9-3, but now it's gone, so it will try with Buick, I supposed, but this is a non-performance-oriented brand... Nothing to compete against the Lexus IS; much less against the 1-Series, and even less the Mini. No developed luxurious 4-cylinder engine program either.
Sure, Chevy introduced the new Camaro to inject some life into it's line-up. This was definitely a much needed halo car, but it is also yet another big car that banks mainly on brand loyalty and novelty factors but steals no sales from the Japanese or Koreans - the latter of which have been making money with the products GM doesn't believe Americans want to buy.
I'd advise GM that if it is going to use Opel products to sell them here in the US as close to their originally intended design as possible -- or the same with no change -- and stop wasting money on reformatting them to accommodate supposed American tastes. Instead they should use that money on strategy and good marketing -- as opposed to the half-hearted attempt under Saturn for the Astra and Aura.
Did I say too much? Too obvious it struck a nerve?
JORGE
R.I.P Opel
Good move!
With the products GM and Opel are putting out now, both will be successful.
Look at last months sales. GM far out performed Ford, considered by the"experts" Americas strongest car company and increased its market share with four less brands.
GM is probably going to fail again...
1)They've kept most of the old management in place ffs.
2)They are behind in many technologies compared to Japs/Eur/Koreans, and you just can't push a button to get tech instantly.
Their top management is all over the place. Personally I see them as a huge elephant in downtown NY, lost and not knowing where to go or what to do. I think Magna would have done a better job with Opel.
p.s. F@@@ if they come asking for bailout money again, they better get their asses rdy.
The German part of GME is over manned and old, this will feel the full force of any restructuring, which it has resisted for a long time. GME can be a shining jewel in the crown and has been in the past a good profit maker.
Only time will tell, but do not be surprised where and when the axe falls, but I fear that the German end of GME will be the biggest casualty.
Maybe they should take this as an opportunity to transfer the rights to all the intellectual property from Opel/GM Europe to GM proper, and then shutter Opel. Even though I like GM's cars, the company still has a tendency to screw people over and let people down. Why not continue that streak in Europe?
If I was Magna I would be sooooooooooooooo upset... I would sue GM all the way... this is no way of doing business... the deal was amlost closed...
-Fredster1
GM already tried selling Opels in the US. They were called Saturns. I don't know the numbers, but I see a lot of the apparently poorly made in Mexico rebadged Opel SUVs, and not many of the German made Astras and US made Auras (Vectra). Personally, I think the Aura was nicer than the Malibu, which is built on the same platform. The Astra went over so poorly they stopped importing them after the 2008 model. Of course, they were both models that were getting toward the end of their model cycles when they first arrived here. Plus most buyers probably knew that these Saturns were not the extremely reliable if otherwise crappy US made plastic Saturns. Also the Astra was preceeded by the oddly designed Ion. Plus, like Jorge wrote, the marketing seemed half hearted, like GM already saw the handwriting on the Saturn wall and was just marking time while they decided what to do. Anyway the replacement Astra and Insignia are supposed to be much better. I read somewhere that GM is planning on slapping a Buick grill on I think the Insignia and selling it here.
I work for Magna and I am soooooooooooo happy.
We are a supplier, not an OEM. This aquisition was jeopardizing all of our relationships with our current customers. They were begining to look at us as competitors and considering not giving us any more work. At the very least this decision may have saved some American jobs mine being one.
If GM were to keep Opel, then they should totally shelve Vauxhall or sell off that brand. I can't see GM sell Chevy Cruze alongside a Vauxhall version. Does this remind anyone of the old GM in USA?
German workers at Opel are totally against the continueing ownership of GM. Even GM Europe Boss Forster is against that decision. Today they have been on strike in all factories, see the pictures here:
- http://www.spiegel.de/video/
- http://www.spiegel.de/fotostrecke/fotostrecke-48536.html
- http://www.spiegel.de/fotostrecke/fotostrecke-48556.html
Also the german governement is very upset. GM will have a difficult task.
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