REPORT: Opel labor union goes on the offensive, GM negotiator meets with German feds
The battle for Opel has added another front: Opel labor unions at two of the company's German factories retracted an agreement made last year to forgo vacation bonuses. The move demands that General Motors pay the laborers €70 million ($100.2M U.S.) by next week, the amount that they agreed to give up when GM was trying to rescue itself. Workers at two other Opel factories in Germany are expected to make the same move some time this week. The workers want GM to sell to Magna, and if The General doesn't make its intentions plain soon, the next step will be for Opel labor to demand the wage hike they waived last year, which would see the automaker owe another several hundred million euros.
According to Automotive News, GM's board met to discuss which bidder, Magna or RHJ, it would go with, but instead of making a decision it sent its lead negotiator back to Germany to talk to government officials. As of last week, there were rumors of GM wanting a buyback option for Opel, which could get GM quickly back into Europe when the company restores its fortunes. The option seemed to make RHJ the leading bidder, but not the one German government or labor wants.
If RHJ wins, it will get no state aid. If Magna wins, it has been pledged €4.5B ($6.4B U.S.) in government loans. The disadvantage could cause RHJ to deal with Opel drastically, which would greatly displease a whole lot of Germans. Perhaps that is why there is now talk of GM not selling Opel at all, instead looking to raise $4.3 billion to keep Opel in the family. With GM barely out of bankruptcy, and with economies still shaky, observers aren't sure where GM would get that kind of money. It is thought that GM will announce its intentions in the next day or so.
[Source: Automotive News, sub req'd]
Reader Comments (Page 1 of 2)
fixitfixitstop 11:02AM (8/26/2009)
Kinda off-topic, but something tells me that if the Astra were sold as a Chevrolet rather than a Saturn, it might have been more successful.
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mortonb11 11:13AM (8/26/2009)
no doubt
Wanted 12:55PM (8/26/2009)
I definitely saw a Chevy Cobalt this morning at 1 with Astra headlights. It was very attractive. Only because it was unique, though. Imagine a mass-produced version... not as cool.
Avinash machado 11:05AM (8/26/2009)
I think it would be great if GM kept Opel.
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adrian 11:51AM (8/26/2009)
I heard that they might just do that after all.
DayShifter 12:45PM (8/26/2009)
Hummm, not sure, just because of the current problems with the union, for that reason alone I would get rid of the company. Just don't trust them, but that's just my two...
Judy Zik 1:53PM (8/26/2009)
What it all comes down to is that there are quite a few folks at GM who agree with you. They want to pass it off to someone else to do the hack and slash and then buy it back. They really don't want to have to cut ties let alone potentially compete with Opel. One also has to wonder whether or not Ford might be having second thoughts about selling Volvo given the silence. These decisions made bean counters happy in the dark times but might not be good long term strategy.
Redline 2:29PM (8/26/2009)
If they keep it they should import it into North America as Opels, including the OPC models.
geo.stewart 11:10AM (8/26/2009)
where will it get the money? same place it would get it if it sold it. RHJ. They will announce a joint venture/investment deal where GM is still engaged and therefore on the face nothing changes.
and no the Astra would not have sold better as a Chevy. its whole problem was that it cost to much to build in Europe AND ship over. probably couldnt have sold it as a buick with a waterfall on it. its a good car but not great, as it was sent over here.
build it on this continent and not have shipping and they could have marketed it lower and done much better.
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montoym 12:53PM (8/26/2009)
Lots of cars are built in Europe(and Asia for that matter) and shipped across the World to us. They are from all price levels as well. Convenient that the argument is used here, but not on the numerous other models that do the same. It's a part of the problem, but not the primary issue.
The Mini Cooper is even more expensive(starting at over $19k and skyrocketing to nearly $40k) and it's considered a sales success despite having supposedly the same problem as the Astra had. It's built in Europe and shipped here and has a higher cost than its rivals. That's only a single example.
I think that had they actually advertised the Astra, they'd have had a lot more sales. Few people knew it existed even up until it was killed off. Combine that with us(Americans as a whole) still preferring sedans to hatches and it was doomed to failure.
I do also think they could have done more to give us more options as well. The trim level options were awkward and the powertrain was a single, outdated 4cyl(complete with a 4spd auto) when GM has numerous other fine engines and transmissions that slot nicely into the same space. A more powerful gas engine(even as an option), diesel option and an Astra Redline(modeled after the Astra OPC overseas) would have been a start. Instead, it was really more of an afterthought, like we had been served the leftovers.
MeiSooHaityu 11:11AM (8/26/2009)
Man, this is turning out to be one big mess. It will be interesting to see how it plays out.
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Steve Lopez 11:25AM (8/26/2009)
Agree to the Union requests and just pay them back when GM starts to make money.
GM needs to say in Europe. Stick with Opel and put some Chevy badges on some of the smaller products. It can work. Pontiac is gone and Buick needs to really get its marketing people on the ball. Market to a broader customers base.
More European and Asian markets might work. China loves Buick!
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DC 11:15AM (8/26/2009)
Look into RHJ's background folks. Mr. Rattner has close ties with them. It is a plain setup for GM to buy-back Opel later, after RHJ cuts the fat. This is crony capitalism, not competition.
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Lar7789789 11:16AM (8/26/2009)
oh wait isn't that a Saturn Aura in the picture?
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fixitfixitstop 11:20AM (8/26/2009)
No. It's an Opel Astra, which was sold as a Saturn in the U.S. The Aura is a different animal.
Lar7789789 11:16AM (8/26/2009)
isn't that a Saturn Aura?
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why not the LS2LS7? 11:22AM (8/26/2009)
Typical union solution to every problem. Demand more money. Even after your owning company want bankrupt. Great job guys. Just a little more pressure and blood will flow from this stone.
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falcon5768 1:12PM (8/26/2009)
Um when you agree to something, your supposed to hold up your end of the bargain. That is the whole REASON the Unions are going after GM. They agreed to a whole slew of stipulations in response to everything going on, and are now getting dicked over because GM wont play legitimate ball and sell Opel.
Its one thing to be anti-union because they do something wrong. But you just look like a flaming idiot if you think the unions should bend over and take it because GM is dicking around.
blah 12:40PM (8/26/2009)
That's unfair. When GM was first suffering, the workers gave up a 100.2 million agreement that was written in paper and ink, something that they was GM was obligated to do. Now that GM keeping Opel is no longer an option, it is the workers' right to worry about their fate and decide their future employer.
If you were a worker at the Opel plants, would you rather have Magna; a company that has been in the industry for decades, has a vested interest in keeping the company and compete in the market, has vowed to keep many German jobs, potentially yours. Versus RHJ a company that has no experience running a auto manufacturer, opportunistic, investment bankers, that will very likely trim the fat and cause massive layoffs potentially yours.
Personally, i think GM is the one to blame in this deal, it is their right to want the best benefits out of this deal, but they basically have no regard for the welfare of Opel's workers. GM is being selfish, they don't want to compete with the Russians/Canadians, so they would rather sell the RHJ. A buy-back clause is ridiculous, how can you sell a company saying that you will buy back at a later date when you more financially sound, its not a bloody pawn shop, its a sale, that's it. GM f*ed up, they lost billions and went bankrupt, they don't get the right to buy it back.
I think its great that the workers are doing this, they are worried about their future, and have made the Magna deal more attractive. It's their livelihood, they should have a bloody say in it.
DayShifter 12:49PM (8/26/2009)
@blah,
I hope you never own a business where you're forced by your employees to make your decisions.