By on June 11, 2011

Opel workers in Germany are getting increasingly frustrated and are banging the table. Rainer Einenkel, head of the works council in Bochum, today demanded that GM management in Detroit “immediately makes a clear and unambiguous statement, and to deny the plans of a sale without ifs and buts.” Rainel Einenkel writes on the website of the works council in Bochum that “ambiguous statements aren’t helpful, neither for the workers nor for our products.”

Yesterday, Germany’s chancellor Angela Merkel also demanded clarification from Detroit after the German newspaper Die Welt had written that China’s BAIC had made an offer for Opel. The paper said that GM’s board is tilting towards cutting Opel loose. On Thursday, Der Spiegel and Auto Bild had written that “GM is slowly wising up to the fact that the reasons that led to the planned Opel sale in 2009 have not changed.”  Media reports said that GM CEO Dan Akerson is getting impatient.

Now, it seems, there is impatience all around.

In the meantime, I finally tracked down my former Opel executive who always had been a dependable source.From his holiday home where he observes the long Pentecost weekend, he said:

  • The board had always been divided over the Opel issue.
  • There always had been a faction that favored letting Opel go and rolling up Europe from the East for Chevrolet.
  • The board accepted to keep Opel after optimistic plans had been submitted.
  • The plans saw Opel to return to profitability in 2012 or 2013.
  • The plans assumed a rebound of the European economy and deep cuts in personnel and plants
  • “The economy did not turn around. The restructuring plans were watered down.”
  • “For this year, I expect a loss the same size as last year. Next year, no idea, but no black numbers.”
  • A takeover by an outside party will be complicated and will necessitate several years of tight cooperation between GM and the buyer.

Note: He’s no longer at the company. These people usually have their old boys networks, but don’t know the latest.

As the $5 billion investment into GM-Daewoo, and another $1 billion investment into Russia show, the eastern front plans are alive and well. The GM stock would definitely do better without the losses on the books. The stock market loves growth stories. It punishes gllom & doom.

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11 Comments on “Opel Soap, Day 3: Unions Demand Clarity, Deep Throat Speaks...”


  • avatar
    mike978

    Fascinating. When I first heard about a possible Opel sale back in 2009 I first thought it was crazy since Opel did a lot of engineering work for GM and provide cars for them (Regal etc). However I have seen that Chevrolet is established in Europe and growing so GM would not be vacating an entire market. It might therefore make sense. I can understand the new push if plans submitted two years ago are now not being realised (less restructuring and less economic growth).
    If the Chinese did buy Opel it will be interesting to see if the European public would like that and whether Opel/Vauxhall sales plummet.

  • avatar
    Patz

    Mike,
    Chevy in Europe is far away from Opel, in market share. Far away means – out of the main competition of the market.
    The reason is that Europeans customers sees Chevy more as a Korean brand rather than an american one. In the fact, they are right – as all the Chevys sold in Eu are probably coming from Korea.
    Chevy sells because they offer good value for the low money – but as soon as their prices gets closer to the competition, their cars gets undersold. That’s what happened to the Spark, which is too expensive when compared with its predecessor, which was a best-seller.
    So, I see it very hard for GM to stay in the main competition in Europe without Opel. They would need some attractive product, maybe with a bit higher price (and quality) and another brand. (That’s what actually Opel does, btw).
    In addition, Opel owns good technology for GM (expecially in this moment when the U.S. market seems to be going a bit ‘downsizing’), as Ford Europe for Ford U.S.
    Anyway, I understand that in the short-term GM would better live without Opel, as they are burning money. And I understand that the CEOs gets paid on the short-term, so they don’t care too much on what would happen in the long-term….

  • avatar
    mike978

    Patz, I agree with you. But at least GM does have Chevy in Europe so it gives options. Whereas someone like Ford who if they decided to leave Europe because of comparable losses have no other outlets.

    I never meant to mean Chevy is close to Opel, now. But over time there cars will lose their Korean roots and there is potential to grow to a respectable market share (say 5%)

    • 0 avatar
      Patz

      Yes, sure. There is a possibility to get rid of the ‘Korean’ brand-outlook.
      I mean – I have nothing against Korean cars.
      But most of the customers, when they have an Aveo for 2000euros less than a VW Polo….they still go for the Polo.
      European brands are very strong in Europe, and our market is a bit different than yours. We are very tight to our brands. That’s why I think Opel is important for GM, if they want to keep Western Europe.
      But this said, you are right – if they let Opel, they’ll still have Chevy.
      Which actually has many dealers and structures in common with Opel, btw.
      And more important, what about these engineering center which Opel has, and are very good values. I will keep following up the news, let’s see.
      Enjoy your sunday.

      • 0 avatar
        geozinger

        What GM has in Europe witht the Opel/Chevy strategy is the “two brand” strategy like Honda/Acura or Toyota/Lexus in the US. For better or worse (and I would say better, as I’ve owned a couple of Epsilon cars), much of what Opel provides GM sells worldwide. A complete decoupling of the two companies would be tricky.

        I have to say, this is the best GM rumors website I’ve ever visited. I’ve stopped reading all of the other GM sites…

      • 0 avatar
        Patz

        @geozinger
        Yes, and I like you guys commenting in these discussions. On my mother language forum-websites they talk a little bit too ‘local’, and sometimes not really knowing what are they talking about. And in Europe we have different languages, which means I can hardly participate to discussions in German or Spanish, even if I still understand what they say.

        btw, yes the epsilon (and the II expecially) gave some good results. The Opel Insignia is a best-seller in its segment in Italy, just a few pieces below the Audi A4 (which makes the highest market volumes here, mainly due to company fleets).

  • avatar
    Steven02

    Chevy is doing fine in Europe, but it is Eastern Europe. Not so hot in Western Europe. That is what GM would be losing with Opel. Also, the engineering would be gone.

    Apparently GM owns the tech center and it isn’t part of Opel. I still don’t know what a sell of Opel would do to the engineers. It would be interesting, but I think it would be the wrong thing to do. I do know that GM wants the Chevy brand to be global. They can do it, but I think cutting Opel would just hurt the product.

    • 0 avatar
      doctor olds

      “General Motors has no plans to sell Opel/Vauxhall despite CEO Dan Akerson being “fed up” with the speed on the European firm’s recovery, industry sources have revealed.”
      “Opel boss Karl-Friedrich Stracke yesterday dismissed the original sale reports, which cited no sources, as “pure speculation”.”
      “Despite GM’s apparent frustrations with Opel/Vauxhall, the sources claim a future sale would be unlikely, due to the European firm’s close integration of its platforms and powertrains with the rest of GM’s worldwide operations.”
      “A German government source has also said it is not involved in any Opel sale talks.”

      from autocar:
      http://www.autocar.co.uk/News/NewsArticle/AllCars/257637/

  • avatar
    obruni

    western europe is not an automotive market with much in the way of growth.

    and being Korean isn’t necessarily a negative in Europe, Hyundai and Kia top many Japanese brands in market share, including Honda.

    • 0 avatar
      Patz

      Obruni, when you say that western europe will not grow anymore – I think you are right.

      But when you say ‘Korean isn’t necessary a negative in Europe’, sorry but I think you are wrong.
      Hyunday and Kia together had 2,8+1,7 (4,5 in total) in the overall European Union, Opel alone has 7,8%; Toyota 4,5.
      Chevrolet 1,2%.
      Honda 1,6%.

      Source: ACEA; basis: Jan-Mar2011

      In a few words, they are in a good shape thanks to good value for the money – as soon as the price gap gets closer for a Korean to an European, the customer goes to the European car.

  • avatar
    mike978

    Patz – you are right, Europeans like their Euro brands, before I moved to the US I owned a Rover (inherited), a Peugeot, a VW and a Seat. Euro brands don`t just top Korean brands they top Japanese brands. There is not much difference (as shown by the figures you quote) between the Koreans and well established and very successful (in the US) Japanese companies. I would also note companies like Subaru do badly in Europe as well. Chevy is an American brand, like Ford so that prejudice can to some level be overcome.

    I agree letting Opel go is probably a bad idea on balance but it is no longer that clear cut hence the discussion.


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