German Government Won't Assume Whole Risk Of Opel Bailout – If Any
Another bucket of cold water on bailout plans for Opel. This time from Germany’s economics minister, Karl-Theodor zu Guttenberg. He used to be one of the biggest pro bailout flag-wavers; he even trekked to DC for a largely uneventful event. Now he signals to potential suitors of Opel that Berlin’s dowry will be less generous than hoped. “The wish of some interested parties, that the German government will assume the full investment risk over years is unrealistic,” Guttenberg said to the German paper Die Welt am Sonntag. He also warned other politicians not to raise false hopes amongst the Opel workforce. And he punts the ball back to Rüsselsheim and Detroit: whether Opel will get support from Berlin, “depends on the concept submitted by Opel and mother GM.”
Chancellor Angela Merkel will visit Opel in Rüsselsheim on Tuesday. She will come with empty hands or at least with empty promises.
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I think Germany's stance would be markedly different if the company in question were headquartered in Munich, Stuttgart or Wolfsburg. Opel is a major cog in Germany's industrial economy and a massive employer but it's headquarters in Detroit has always been a thorn in their side. Why should they pay for what they can get back for free? They have brought this company "home" once before. Founded in 1862, it is not without a long and at times quite proud German history. It's only been soiled. Never underestimate German Nationalism. As an aside, the company started out making sewing machines. With the Opel Ampera, they will have come full circle.