Calls Mount to Save Opel From GM Cash Crash

01 December 2008

RUSSELSHEIM, Germany: Calls are mounting for German auto marque Opel to separate itself from its ailing parent General Motors, so as to avoid the risk of bankruptcy if the US auto giant fails in its current bid for a US government bail-out.

Frank Asbeck, chairman of renewable energy firm SolarWorld, recently made a €1 billion ($1.2bn; £832m) bid for the German brand's production operations, and 1,000 Opel dealers in the country have also proposed a buy-out of the company.

GM originally purchased Opel in the 1930s, but a spokesman for the Detroit-based manufacturer responded to all talk of divesting its German operations with a blunt: "Opel is not for sale."

Klaus Franz, the chairman of Opel's employee representation body the European Works Council, has also previously said "GM won't let us go."

Pronounces Christoph Stuermer, automotive analyst at Global Insight, the reason for this is one of pure economics: "Opel still makes money for GM."

Stuermer described Asbeck's offer as "a slap in the face" for GM, but argues it may be willing to sell Opel should an offer of sufficient magnitude be received.

Opel's Western European market share has fallen from 13.2% in 1993 to around 8.6% so far this year, and Ferdinand Dudenhoeffer, director of the Center for Automotive Research, thinks bidders could be waiting to see if GM enters bankruptcy proceedings. 

Says Dudenhoeffer: "Then Opel could be a real bargain for, say, the Chinese, who wouldn't mind the technology that comes with it and a foothold in the European car market."

Data sourced from Deutsche Welle (Germany); additional content by WARC staff