Word: european
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Thousands of Opel workers in Germany are breathing a huge sigh of relief after the last-minute deal to rescue GM's European operations. German unions had always supported Austrian-Canadian company Magna International's takeover of GM Europe, wary that the rival bid from Fiat was just an attempt, as one union official put it, to "pinch German engineering." The unions regard Magna as an innovative company that put forward the best plan to secure the long-term future of Opel. At the carmaker's headquarters in the town of Rüsselsheim near Frankfurt, workers were hugging friends...
...were ring-fenced from the Chapter 11 bankruptcy in the U.S.," Klaus Franz, the head of Opel's works council tells TIME. "Of course I'm also worried about my U.S. friends, but I'm happy the bridge financing plan for Opel has worked out and all GM's European assets have been guaranteed," he says. But despite the German relief, major sacrifices among GM Europe's 55,000 workforce are unavoidable in the coming months. (See pictures of General Motors Factory-scapes...
...After marathon talks on Friday night, the German government approved plans by the Austrian-Canadian car-parts manufacturer Magna to take over GM's European business. Under the deal, Opel will be placed in a trust and the German government will provide a bridging loan of $2.1 billion (€1.5 billion) to provide Opel with emergency funding and keep GM's European operations running. On top of that, the German government will give $4.3 billion (€3 billion) in loan guarantees. The Canadian firm would own 20% of the new group, Russia's biggest lender Sberbank would have...
...Europe are in the dark over what the plans mean for them in the future. Opel employs around 26,000 workers in Germany, almost half of GM Europe's total workforce of 55,000. With Germany in the driving seat during the negotiations, politicians and trade unions in other European countries are concerned the new investor Magna, along with its Russian partners, will protect German jobs at the expense of other jobs. "There are going to be more tough negotiations with GM Europe and Magna," says Klaus Franz, the head of Opel's works council. "A very stony road lies...
...German union leaders insist other European countries will play a role in future negotiations with Magna over the restructuring. "We need a pan-European solution and I'm sure other European countries will come up with loan guarantees in the future when the new group under Magna is reshaped," says Klaus Franz. But it could be months before GM's workers in Europe find out what its new owners have in store for them...