After GM announced that they would keep Opel after all, they boasted that “the GM plan entails total restructuring expenses of about €3 billion, significantly lower than all bids submitted as part of the investor solicitation.” After hearing the statement, industry insiders snickered that €3B would be “hardly realistic.”

Now, credit rating agency Moody’s confirms that GM either made that number up, or they lied. Not even close, says Moody’s.
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The Chinese government had announced earlier this year that it wants to “encourage” its more than 100 automakers (nobody is quite sure how many there really are) to consolidate. The goal: Make China’s industry more competitive with foreign rivals. Beijing wants to see four big ones and four smaller ones. Unsaid: the remaining 90-odd carmakers should look for other employment.

To lead by example, the Chinese government just initiated one of the largest merger deals in the Chinese auto industry. Easy for them to do: The government owns both companies.
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At the upcoming 2009 Guangzhou auto show, Volkswagen China is expected to announce that they will build a plant in southern China, Gasgoo writes, citing reports in sohu.com. Not much else is revealed, not even which of their two Chinese joint venture partners will get the new plant.

Volkswagen cooperates with two companies in China: FAW, based in Changchun in the North, and SAIC, based in Shanghai in East China. Both are bitter rivals.
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After scraping by owning Opel together with alleged Russian mobsters, Magna has given up aspirations of being a car company. Magna wants to “focus on its core competencies,” and will continue to be a supplier and contract manufacturer. This is what Magna’s Co-CEO Siegfried Wolf said to Germany’s Handelsblatt.

Magna’s cozying-up with GM continues. “We have contracts from GM, and there is no reason why we should not get new ones,” Wolf said. Then, the ultimate brown-nosing is perpetrated:
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Intellectual property warriors, get your guns: Following GM, its arch nemesis Toyota will plant a brand new R & D center smack into the alleged intellectual property jungle called China. Toyota plans to spend between $330 and $440 million for the center. Building will commence next year. Compared to Toyota, the one GM built in 2008 was the lite version at a price of only $250 million.

The Toyota R&D center, complete with a full-scale test course, will be located not far from the GM center, in the outskirts of Shanghai, Gasgoo reports.
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Get ready for GM leaving the country and moving to China for good. GM’s sales in the world’s largest auto market more than doubled in October from a year earlier. GM sold 166,911 vehicles in China last month, Reuters reports. From January to October, GM sales in China amounted to 1.46 million units and exceeded 1.5 million units as of Monday.

In the US, GM had sold 176,632 units in October, and 1.7 million units for the first ten months of the year. If this trend continues, GM will soon sell more cars in China than back home. Last September, they already did.
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The Chinese city of Shanghai is thinking of rewarding buyers of an eco-friendly alternative-energy car with a free license plate, Shanghai Daily reports via Gasgoo. Big deal, you say? In Shanghai, it is a big deal.
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Wasn’t losing their precious intellectual property to the Rooskies the biggest beef GM had with the Opel-Magna-Sperbank deal? Wasn’t it clear that Sperbank wanted to sell its shares to GAZ? Wasn’t GM trying to block this deal by inserting a buyback clause? Now that GM has decided to keep Opel, those fears have evaporated. In the so far strangest twist in the Opel soap, GM is busy trying to salvage exactly the oddest part of the deal: The Opel-Magna-Sberbank-GAZ deal.

The DetN, the unofficial in-house organ of GM, reports (without flinching) that GM officials “still hope to negotiate an agreement with Magna and Russian automaker GAZ. A source familiar with the situation said GM has already contacted Sberbank.” Exactly. The same bank that is owned by oligarch Oleg Deripaska who had his US visa canceled amidst allegations of money laundering and organized crime. And who had to cut a deal with the FBI to be allowed back into the country. And who, according to the New York Times, “has repeatedly denied media reports that he had acquired a major stake in U.S. car maker GM.”
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When GM’s Fritz Henderson called Magna chief Siegfried Wolf and told him that GM had an irreversible case of seller’s remorse, Wolf’s flabbergasted counter was: “Are you joking?” Fritz told him he’s dead serious. Opel will stay with GM. Now, all Wolf has left for GM is unsolicited advice: Give more freedom to Opel and tread carefully with the brand and the unions. “GM must now smooth things out and win back trust. That requires a lot of sensitivity and tact,” Wolf told the German newspaper Bild am Sonntag (via Reuters).

It doesn’t look like GM will be heeding the advice. New Opel Chairman Bob Lutz and new GM-E chief Nick Reilly are known for the sensitivity and tact of a Sherman tank. Supposedly, both are here on a temporary basis only until new outside managers are found. It could be a long search, if it is a real one at all.

On Monday, Fitz Henderson will come to Germany and try to smooth over things with the workers, Opel’s worker’s council chief Klaus Franz told German media. It will be a tough talk.
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So used has the MSM become to China’s red hot car growth, that Reuters headlines the October sales report “Chinese car sales dip in October, but still robust.” China’s passenger vehicle sales clocked-in a year-on-year growth of 79.6 percent in October. In September, the growth was 83.62 percent, which serves as the reason for Reuter’s slight concern.
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China’s Ministry of Commerce on Friday announced it would formally launch an investigation into subsidies on imports of some automobiles from the United States, Reuters reports. With all the bailout money sloshing around, China won’t have a hard time coming up with evidence.
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If the GM-SAAB-Koenigsegg-BAIC deal ever closes, Beijing Auto (BAIC) would be interested in taking the current generation Saab 9-5 and produce it in China once the 2010 Saab 9-5 is launched in Europe in April next year, Chinese media reports via Gasgoo.
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What happened two days after GM blindsided most of Europe, including Russia, with their decision not to sell Opel after all? As announced the next day, Opel workers in Germany laid down their tools today. Tomorrow, workers in Opel plants in the rest of Europe will follow.

Yesterday night, German Chancellor Angela Merkel picked up the phone, called her colleague Barak Obama and voiced her displeasure. “Obama said he had not been involved in the surprise decision by the GM board,” Reuters reports. Isn’t Teflon wonderful? Angela told Barak that his state-owned company better pay back the balance of the bridge loan by the end of the month. She even dispatched her very own collection agent to DC.
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With all the noise about GM’s interruptus of the Opel sale, we could forget that there is a brand GM wants to sell, badly: Hummer. Since June  it had been announced that the sale of Hummer to little-known Tengzhong in China is as good as done. Except that it wasn’t.

Still ain’t.
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On Tuesday, twenty years after the fall of the wall that separated the two Germanies, German Chancellor Angela Merkel went to Washington. For the first time since Germany’s Chancellor Adenauer in 1957, the topmost German addressed Congress—to roaring applause.

There was another wall. A wall of silence. Nobody in the US government—owner of General Motors—supposedly had heard a whisper that their most expensive ward of the state had changed their mind, decided to keep Opel, and go home alone. Before the speech, Angela chatted with Barack about high finance and the crock of shit also known as global warming. Not a peep about Opel.
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