10 September 2009 - 17:00
Opel-Vauxhall goes to Russia
General Motors is selling off a majority of its European arm Opel-Vauxhall to a consortium of Magna (a car parts supplier) and Sberbank (the Russian State bank). So the immediate future of the new Astra and the rest of the Vauxhall range is secure. There had been a chance that the troubled American parent was going to liquidate Opel-Vauxhall.
The deal is good news for workers in the group’s German plants, but British unions are unhappy. That’s because the deal is being subsidised by the German Government to the tune of €4.5 billion, because Magna has promised to keep German plants open. The plant at Ellesmere Port hasn’t received any assurance.
GM itself is keeping a 35 percent stake in Opel-Vauxhall. This is no surprise, as a huge proportion of GMs range of cars in America, China, South America and Korea share engineering with the Vauxhall-Opels. The new Insignia and Astra platforms, developed in Europe, are vital to GM’s global future. GM has cut off its own limb and sold to Magna/Sberbank only because it’s in absolutely desperate straits.
Russia’s Prime Minister Vladimir Putin has said he wants a front-line motor industry, and that this deal is a shortcut. Now if you were GM and your range depended on cars developed by Opel, how happy would you be that the technology was now going to Russia? Will they respect GM’s copyrights? Will they resist building direct competitors and selling them in territories where GM itself operates?
So GM had been inclined to hold on the Opel-Vauxhall. But it couldn’t use its US Government bail-out cash to support overseas operations. Its second preference – if it was going to have to sell – was to sell it to RHJI, a venture capital group which would presumably have been willing to sell it back to GM if GM starts to get more flush in the future.
But in the end the Magna/Sberbank deal got the nod because Opel is still losing money and needs ongoing subsidies, and German Chancellor Angela Merkel had decided there were most jobs in the Magna bid. Since she’s facing elections, those jobs are vital to her. She simply said ‘nein’ to the subsidies going to any other bidder but Magna. So politics has decided the future of a major car maker.
Paul Horrell
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Whew - what a relief. The Vectra is safe.
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shame these cars arent in america...
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Hmm... letting politics get in the way of car sales was a bad idea. Of course, jobs will be saved and the short term future is secured, but I think the Magna deal could mean that jobs will be lost in the long term anyway...
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I like the corsa.. its a cool car! Though its pretty much the only opel/vauxhaull car i like...
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Yay, now they can carry making horrible cars that make Fords look good!
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Will the new Astra have a Lada spec?! Could be a bit of a worry for Opel/Vauxhall but hopefully the GM heavies will make sure things are done right and after all it's not like the plants are going to Russia so I don't think there will be quality issues. Let's face it Russians are richer these days than the capitalists they once despised, and now perhaps even the proletariat can get decent cars that will hopefully be subsidised by the Russians so their interests are safe. Power to the people!
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This is going to be crap. take a porsche and add some russia to it: still a good car. take opel and put some russia to it: more crap than before. It´s going to be like in the 80s. rust all over the place. ages ago, they took the brilliant fiat whatever and made a lada out of it! and even fiat turned it into the 124 spider and the 124 coupe. they even supercharged it.
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2 words, MG Rover.... Sadly this looks like history repeating itself, on one hand you have a privet equity company who are best placed to make a good job of it, on the other option backed by governments (to save jobs now) with no care about the long term viability (in Opals case no doubt it will all be shiped off to Russia after the new company fails)
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@KevinB: crap? Do you know what Magna Steyr produces in Graz? Mercedes G-Class (since 1979), Aston Martin Rapide, Mercedes SLS AMG, Peugeot RCZ, KTM X-Bow, Porsche (starting 2011) ... and so on.
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yes, i know but add a little russia to it.... and i´m not talking about the cars made by steyr in graz, i mean the crap rolling off some middle.kasaschian production line. which makes me go sick every time i have to see one of these. i´m not free of emetic feelings every time i have to see a skoda, which is some sort of VW. they have to earn their respect by making some good stuff not by making german technology worse, which by the time, will be outdated anyway.when the first lada or whatever roll off their production lines
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Lets hope they do better than they did with TVR for the sake of UK jobs. The cars weren't good enough anyway and people still bought them so sales will be OK.
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Will they make Vauxhallski Vectraskovkas?
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^ Err, they don't make the Vectra any more, so it'd be the Vauxhallski Insigniov.
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What is the point of keeping Vauxhall brand? Since '70 it is not a british car. It's german Opel - designed and engineered in Germany. The only british design part of Vauxhall is the griffin...
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Bobs commented on this article
10 September 2009
Well hope a deal for Vauxhall can be secured, shame no one could just buy the Vauxhall bit off. Still, if politics decided its future, I imagine our esteemed leader will be fighting to keep the jobs by election time.
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