Today is—how do they put it at AA?—the first day of the rest of the life of Opel. Or not, as the saying goes around here. Today, everybody who has anything to say about Opel’s fate will get together in Berlin. The papers that will take away GM’s daughter Opel and make it a child of the state and parties yet undecided are already written up and are waiting for the signatures, says Die Welt. Klaus Franz, head of the Opel workers council has seen the paperwork, “and it looks good, everything is going in the right direction,” Franz said.
Present at the meeting will be Chancellor Angela Merkel, Freiherr von und zu Guttenberg, the premiers of the four states that are home to Opel factories, GM Europe chief Carl-Peter Forster, someone from RenCen, along with an anonymous representative of GM’s owner, the US government. Principals only. They will quiz the managers of the companies interested in Opel: Fiat, Magna, Richwood. The one with the most points wins.
Again, or not . . .
Von und zu Guttenberg officially is keeping “all options open”—including an “orderly” insolvency. A team of experts is imploring their masters not to make any rash decisions. The experts found glaring holes in the proposals of all three suitors, especially in the favored Magna plan, says Das Handelsblatt. On hearing that, Frau Merkel picked up the phone and called Tovarich Putin, suggesting that he cough up extra rubles. According to the Handelsblatt, Putin’s posture was “non-committal.”
So it comes to pass that there is now officially a fourth suitor, a dark horse that rode in all the way from China: As previously reported in TTAC, it is Beijing Auto. And it’s no longer an idle rumor. Automobilwoche [sub] says that BAIC has made an official offer, and has been anointed as a fourth bidder in Berlin.
The Chinese had the right things to say. They would not close any factories in Germany, and would not make any workers redundant, guaranteed—at least not for the next two years. That should please the premiers and the unions. Even more music for Freiherr von und zu Guttenberg’s ears: The Chinese need much less in the way of government loan guarantees.
GM doesn’t like BAIC. No wonder, GM is in bed with SAIC in China, and BAIC would upset the Chinese applecart. Investment bankers Automobilwoche talked to are worried that BAIC might be too successful with Opel: “They don’t want synergies, they want volume. There is no Opel in China at the moment. They could produce 500,000 Opels in a heartbeat,” said the horrified sources.
But maybe, the China card is only being played to make Magna and Fiat up the ante. “Don’t come up with more money, and we either close Opel down, or we’ll give it to the Chinese.”
Who knows. Soon we shall.
And meanwhile Porsche is in need of 12.5 billion, Ja?
It appears that the German autolandscape is in for some serious landscaping.
There is also another factor which could help shape the landscape.
Yesterday, the BBC reported that the UK government has not ruled out giving “support” (i.e financial) to help secure the the 2 plants in the UK (Ellesmere Port and Luton).
If this goes ahead, whoever wins the race for GM Europe, will have a headache as they will be bound not to close plants in the UK and Germany (the 2 biggest markets and 2 biggest producers in Europe). Which means, if cuts are to be made (and there will be), the focus will be drawn to Poland, Belgium and Spain.
As Mr Leikanger inferred, with Porsche checking the back of the sofa for spare change and GM ready to file Chapter 11, the following weeks will be very interesting for everyone.
http://news.bbc.co.uk/1/hi/business/8068678.stm
The Chinese have to show only enough money to “win.” We know Fiat has no money to throw in to the game. There’s Magna, a supplier, has no money to throw into the game, so they get backed by the Kremlin. This leaves an investment group (which means “job cuts” regardless of how they spin it.)
None of that’s appealing to the German government, and why should it be? Unlike the governments where the three bidders are located, China has never declared war on Germany.
Now let’s see how the rest of the Chinese auto industry responds to the fire sale prices for the U.S.-based former Big 2 out of 3 assets.
This will be very interesting.
Hmmm BAIC eh ??!!
Say you will buy it, protract the discussions for months, retract bid due to “technicalities” and thereby force it to go bankrupt, then come back in a month and buy it for peanuts and then ship the machinery to China…
Idiots, did they learn nothing from The MG-Roewe affair ??!!!!
Bertel! I like the way you’re now covering these stories. You’re building in the inevitable about-face/denial/hedge from day one…..
Tomorrow, the formal denial, I guess.
sutski, no, “they” didn’t learn anything from the MG-Roewe affair, but the Chinese learned all about how to screw over others in just this way by watching how GM screwed over Daewoo when they did just exactly the same thing, in 2002.
Rod Panhard: Sadly, Germany did most of the invading …
PeteMoran: Thank you.
=D
But maybe, the China card is only being played to make Magna and Fiat up the ante. “Don’t come up with more money, and we either close Opel down, or we’ll give it to the Chinese.”
Who knows. Soon we shall.
I agree – the Chinese are just the spoilers to the only political ‘acceptable’ bids from Fiat and Magna.
So why would they do this? At best they could actually win and at least they get to raise the buy in price for the eventual winners and saddle a competitor with higher costs.