Bailout Watch 166: Germany to GM: "Up Yours"

bailout watch 166 germany to gm up yours
“Gotta ask for the bail – I mean sale, ha-ha,” Red-Ink Rick Wagoner told his man in Germany. That would be Hans H. Demant, VP Developent of GM Europe and Managing Director of Opel Germany. Wagoner instructed Demant to ask the German government for €40b, or make that a cool $50b. “What should happen, Hans? The worst thing Angela can say is no.” Demant didn’t want to go eye-to-eye with Chancellor Angela Merkel. Instead, he wrote a letter, to be co-signed by Klaus Franz, the head of Opel’s Workers Council. Usually, Demant avoids signing any paper that has Franz’s signature on it, but the situation was dire, and the message to be sent was “jobs, jobs, jobs.” In the letter, GM Germany’s unlikely duo applied for loan via the European Investment Bank, as soft as marshmallows. While they were at it, they also suggested cheap credit to buy new Opels cars, and cash into the hand of each upstanding German citizen who feeds his Opel car older than 10 years into the shredder, along with a tax credit to reward the purchase of a new car. “That should do it” said Demant. Both signed, and the urgent enquiry for Euros was expressed to Berlin.“They’ve got to be kidding us” said Frau Merkel (not in public) and instructed her spokesman to deny the request, politely pointing out that there is already a prop-up package for the whole industry afoot. Forget any special goodies for GM. She left the public flogging to Peter Ramsauer, himself head of the CSU faction in Germany’s parliament. “The Opel-guys must have lost their mind,” ranted a rambunctious Ramsauer. ”They can stick that whole program up their — hat.” We aren’t making it up, it says so right there in the Handelsblatt. (Knowledge of German required. Or take our word for it.)The “gotta ask for the bail” letter may have blown the chances for a German tax relief for new car buyers. The same day Opel’s shit hit their unusually unsympathetic fans in Berlin, noises emanated from Germany’s capital that the green washed no-tax-on-new-cars-program may already be dead in the water. It may not even leave the cabinet alive. If it does, the package will be thrown to the wolves in the parliament, who most likely will rip it to pieces. Hans and Rick are not very popular these days amongst Germany’s auto makers. Fried minds want to know: Where else in the world is GM going begging?UPDATE: Tuesday-Night-In-Germany-Flash: Berlin got over it. They met and agreed to the tax reduction after all. If you are in Germany and buy an environmentally sound car in the next six month, no car taxes will be due for the next two years. A cash handout for those who dispose of their old clunker may also be considered. Not even a mention of Opel.
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  • John Horner John Horner on Nov 12, 2008

    Shh, don't tell those European politicians where GM profits go ... they may get the wrong idea about transplant automotive factories. Quiet now class!

  • Bertel Schmitt Bertel Schmitt on Nov 12, 2008

    @germanguy: Richtig! My bad. Demant mustabeen too close to dementia for my keyboard. Anyway, shall be fixed as soon as our Dear Leader awakes. There is still a Ramsauer/Röttgen boo-boo, shall be cleaned-up also. Hectic news night yesterday. @tom: Spot-on as always. I would venture the guess that many Germans don't even realize that Opel is being owned by GM. Opel is viewed as a purely German brand - as they were. The Police in Opel's state Hessen proudly (or maybe not) drives Opel. GM's attempts to introduce other more 'merican brands to Germany were a dud. Ford is likewise regarded as a local. Hey, there's ample history. Other than with Opel, people know that Ford is American, but it didn't hurt them. Ford and Opel were always members in the German auto club. It was the Japanese and later the Koreans they tried to keep out - to no avail. German automakers are a incestuous breed. Folks wander from Volkswagen to BMW, to Mercedes, and back. If you go work for Toyota, don't even think of applying for a job with "the family" again. (Well, maybe in QA.) When I started working for (not at) VW in 1973, they just had assimilated a whole gang from Ford Germany who had left in protest when their powers were curtailed. They were long called the "Ford Mafia" in Wolfsburg. Piech's activities in hiring talent and know-how from GM/Opel are legend and notorious. Garcia Sanz, who started his career at Opel and was an understudy of Lopez, sits on the BOD of Volkswagen AG.

  • Inside Looking Out Why EBFlex dominates this EV discussion? Just because he is a Ford expert?
  • Marky S. Very nice article and photos. I am a HUGE Edsel fan. I have always been fascinated with the "Charlie Brown of Cars." Allow me to make a minor correction to add here: the Pacer line was the second-from-bottom rung Edsel, not the entry-level trim. That would be the Edsel Ranger for 1958. It had the widest array of body styles. The Ranger 2-door sedan (with a "B-pillar", not a pillarless hardtop), was priced at $2,484. So, the Ranger and Pacer both used the smaller Ford body. The next two upscale Edsel's were based on the Mercury body, are were: Corsair, and, top-line Citation. Although the 1959 style is my fav. I would love a '58 Edsel Pacer 4-door hardtop sedan!
  • Lou_BC Stupid to kill the 6ft box in the crewcab. That's the most common Canyon/Colorado trim I see. That kills the utility of a small truck. The extended cab was a poor seller so that makes sense. GM should have kept the diesel. It's a decent engine that mates well with the 6 speed. Fuel economy is impressive.
  • Lou_BC High end EV's are selling well. Car companies are taking advantage of that fact. I see quite a few $100k pickups in my travels so why is that ok but $100k EV's are bad? The cynical side of me sees car companies tack on 8k premiums to EV's around the time we see governments up EV credits. Coincidence? No fooking way.
  • EBFlex "I'd add to that right now, demand is higher than supply, so basic business rules say to raise the price."Demand is very low. Supply is even lower. Saying that demand is outstripping supply without providing context is dishonest at best.