By Andreas Cremer and Jonathan Stearns
Chancellor Angela Merkel said the German government will study a business plan created by General Motors Corp.’s Opel unit before taking any decision on possible aid for the carmaker.
“The German government’s key priority now is to analyze this concept,” Merkel said at a press conference following a summit of European Union leaders in Brussels today.
GM, surviving on $13.4 billion in U.S. aid and seeking as much as $16.6 billion more, may give up as much as 50 percent of Opel as it seeks 3.3 billion euros ($4.2 billion) in European state aid to save Opel. Merkel’s government will receive details on GM Europe’s business rescue plan tomorrow.
Merkel, who’s seeking re-election in Germany’s Sept. 27 national vote, has pledged to make job preservation her main priority as the country’s economy battles the worst recession since World War II. Adam Opel GmbH, which has been making cars in Germany since 1899, employs 26,000 staff in Europe’s largest economy.
Germany may provide as much as 5 billion euros of credits, loan guarantees or acquire temporary government stakes in Opel if GM Europe amends its restructuring plan, the Leipziger Volkszeitung newspaper reported yesterday, citing unidentified government officials. Neither Opel nor the German government returned telephone calls seeking comment.
To convince German authorities on aid, Opel still has to prove that state-backed loans would be used only by its German businesses and not go to GM in the U.S., said Joachim Winkler, a spokesman for the Economy Ministry of Rhineland-Palatinate, one of four German states in which Opel has plants. The German government won’t approve guarantees if loans are channelled to its U.S. parent, Winkler said on Jan. 9.
“There’s a whole series of questions,” Economy Minister Karl-Theodor zu Guttenberg was quoted by newspaper Bild am Sonntag as saying in an interview published today. “What’s at stake is taxpayers’ money that we won’t carelessly put up for a gamble.”
Guttenberg will travel to the U.S. for talks about government help for GM and the effects of the Detroit-based carmaker’s financial crisis on its European divisions, Merkel said. Germany will also seek talks with the U.K., Spain and Belgium where GM’s units have been “affected” by the U.S. parent company’s plight, she added.
“I’m calling to set up a clear working plan,” Merkel said.
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