The intrigue surrounding the “rapid” bankruptcy of Chrysler and the pending financial disaster of General Motors on June 1st appears to be never ending.
A story you will not read in the New York Times or see on the main scream media is the progress in Germany and Italy between Opel, Fiat and the German government regarding both Chrysler and GM.
Though the decision on who gets Opel will be up to GM, or the U.S. goverment, the German government will also play a big role because it would likely have to supply billions of euros in financing guarantees to the eventual buyer.
This has made the Opel tender a political hot potato as the German chancellor is just four months away from a general election and must decide how to save jobs and tax-payers money without losing votes.
Fiat chief executive Sergio Marchionne is looking to create the world’s second biggest carmaker, after Japan’s Toyota, by adding the assets of Opel and Vauxhall to Fiat’s own brands and those of US carmaker Chrysler.This information will not sit well with our government and the Chrysler union.
German media reports, however, said the Fiat plan would involve total job cuts of about 18,000, compared to about 10,000 each for Magna and RHJ. Fiat is also seeking some 7 billion euros ($9.7 billion) in government support, about 2 billion more than Magna and RHJ require.
My question is will Obama offer the same amount of money or more if Fiat goes through with the deal?
Addressing growing media speculation, German government spokesman Thomas Steg called for calm, saying that any premature speculation on a political comment on Opel could affect a government negotiating position. He said the government would be looking at three key factors: a deal for carmaker Opel that secures the most jobs and sites in Germany and does not burden taxpayers.
Steg went on to say that until the government had met with industry experts and the federal state representatives no preference could be drawn.
Steg also reiterated that the primary decision lay with the GM/US, which still has to announce whether it is selling GM Europe, thus offering up Opel( a company that is part pf GM) for tender.
The US government has given GM until June 1 to restructure its operations and prove it can be viable without state aid, or face probable bankruptcy.That deadline is fast approaching!
Marchionne said we want to build a real European car company that will achieve worldwide success. We want to combine Fiat, Opel and Chrysler. If we achieve this we will be the second biggest car company behind Toyota and it will provide jobs not just in Germany, but around the world.
I wonder how this will sit with the Union at the new Chrysler if the deal does go through? And where is the U.S.news on the potential deal between Gm and Fiat for Opel?