German Chancellor: Opel Not Crucial To German Economy

The German government doesn’t seem to be in an awful hurry to bail out Opel. First, Berlin bitched about the quality of GM Europe’s rescue plan which was submitted last month. According to that plan, the German unit, along with its UK-based Vauxhall unit, would be partly spun off. Along with that, state aid to the tune of €3.3B ($4.2B) was requested. Berlin said the plan was interesting but mostly fluff. They demanded another one; it hasn’t arrived. No plan, no money.

And just in case a better plan would be forthcoming, Chancellor Angela Merkel set the bar a bit higher. “Before we decide (on aid), we must know important decisions in the United States; for example, how things proceed with Opel’s parent company General Motors, what independence General Motors can give Opel, what happens with Opel patents,” Merkel said, according to Reuters. That’s a whole bunch of important decisions to be taken before any money is being given.

“We will support companies like Opel if our help can secure a good future for these businesses and not just go up in smoke without taking any effect,” Merkel told newspaper Bild.

The longer this drags on, the more the enthusiasm to bail out Opel abates. Finance Minister Peer Steinbrueck told students in Bonn he would be “very reserved” with regard to state aid for Opel. Chancellor Angela Merkel told fellow Christian Democrats that Opel “is not systemically crucial to the German economy,” a party official told Reuters.

Today, GM Europe chief Carl-Peter Forster had to state, on the German radio station Deutschlandfunk, that Opel is not insolvent. However, GM might reduce its stake in Opel to a minority and some parties have already said they are interested in the German carmaker, even though details of the plan to save it are undecided and have to be approved by the US government, he said. Frau Merkel probably liked to hear that. Again, a decision that doesn’t have to be made.