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General Motors Channels Its Inner Gollum: Hangs On To Opel


2009 Opel Insignia Sedan

In a move that was almost telegraphed, General Motors has announced today that it will keep its European subsidiary Opel/Vauxhall.

In a press release from GM, CEO Fritz Henderson spoke about the decision,

While strained, the business environment in Europe has improved.  At the same time, GMs overall financial health and stability have improved significantly over the past few months, giving us confidence that the European business can be successfully restructured. We are grateful for the hard work of the German and other EU governments in navigating this difficult economic period. Were also appreciative of the effort put forward by Magna and its partners in Russia in trying to reach an equitable agreement.

In terms of moving forward with the revised plan Henderson stated,

GM will soon present its restructuring plan to Germany and other governments and hopes for its favorable consideration.  We understand the complexity and length of this issue has been draining for all involved. However, from the outset, our goal has been to secure the best long term solution for our customers, employee, suppliers, and dealers, which is reflected in the decision reached today. This was deemed to be the most stable and least costly approach for securing Opel/Vauxhalls long-term future.

General Motors cited improving conditions, but many auto analysts had questioned the move from the beginning.  Given General Motors push towards globally shared platforms, it was questionable to hand over control of a key developer of those platforms to a third party.  For example, the Opel Insignia is sold in China and next year in the United States as the Buick Regal (view a slideshow of the Chinese Buick Regal in this link):  Essentially the same car with only light retouching.  General Motors' South American offerings also draw heavily from Opel platforms.

The next big hurdle for GM will be pacifying Opel's workers, no easy task considering that workers put their full support into the Magna deal.  As for Magna?  Many analysts feel that the company dodged a bullet and is better off without the distraction that running Opel would have presented.

 
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Comments (4)
  1. I have read the article based on the Opel model car.I like the post very much as it contain very informative in nature.I agree with the point that General Motors cited improving conditions, but many auto analysts had questioned the move from the beginning. Given General Motors push towards globally shared platforms, it was questionable to hand over control of a key developer of those platforms to a third party. I want to know suggestion of others.
     
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  2. I assume this is an American website, am i right? Well, i would like to explain the situation here on "the other side". I'm from Holland and here in Europe the most people who are in interested and/or occupied in automotive sector are having a grunge against GM. They say that they've held the employees of the Opel/Vauxhall group in distress by stalling and stretching the sale to Magna just to gain time and eventually keep Opel/Vauxhall to themselves. Most workers are now afraid they will lose their jobs when GM will start the reorganisation. But I don't agree with them. No one really knows how GM will reorganise and maybe the new plan is even better than the Magna-plan. And people easily forgot that Opel was saved from drowning by GM in the late 20's and they have always had a good "parent" in them. That's why I, as a dedicated Opel-driver, am happy that GM is keeping Opel/Vauxhall. I'm really optimistic in the future and looking forward to a good, fresh cooperation. We'll see what will happen. I hope my English is good enough that you will understand what I just told.
     
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  3. the dutch guy - that is a great comment. your english is terrific. i agree with you that it is difficult to know how well or poorly Magna would have treated the Opel brand and, importantly, it's employees. i personally hope GM continues to improve it's financial situation so it can actually invest in Open and not have to keep cutting.
     
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  4. @ Autoboy; Thanks for the compliment! I believe the future is looking bright for the "New GM" and therefore also the European part. It's time they rock the world again like they did before. Innovation and quality for a reasonable pricetag.
     
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