Wild Ass Rumor of the Day: GM to Put Opel Into C11

The Wall Street Journal reports that GM is developing a plan B, should the European Union decide that the German government subsidies upon which the Opel deal depends are a violation of some rule or another. “[EU competition commissioner Neelie] Kroes pointed to ‘significant indications’ that Germany had made €4.5 billion ($6.72 billion) in state aid for Opel contingent on Magna winning the bid, therefore violating EU state aid and market rules.” GM now has a window of opportunity to reconsider the whole schmeer—as does the German government, Magna and their Russian sponsors. GM’s backup plan? Keep control of Opel and implement “deeper restructuring actions than Magna is planning . . . GM would fund the restructuring, which includes far more drastic headcount reductions, by soliciting government support or putting Opel into insolvency.” Which should be popular with about-to-strike Opel workers. Oh, and which government was that? Our government? No, of course not. Still, he/she who owns the gold . . .

If GM were to consider another plan for Opel, German Chancellor Angela Merkel could then find herself in the awkward position of financing an outcome that slashed far more Opel jobs in Germany and shuttered some of its plants. Ms. Merkel and her conservative allies are eager to preserve the Magna deal ahead of critical regional elections next May in North Rhine-Westphalia.

Magna has said that roughly 4,000 of the 10,500 Opel jobs it would have to cut across Europe would be in Germany, but it has indicated it wouldn’t shut any plants there. Government officials in the U.K., Spain and Belgium have raised objections, arguing German jobs would be protected at the expense of those in their countries.

See what happens when jobs are your number one product, rather than profitable vehicles? And this will change when? How? Where? Why? With what? Answers on a postcard, please.