04 November 2009 - 10:00
GM calls off Vauxhall sale
General Motors has dramatically reversed its decision to sell its European arm, Vauxhall-Opel. It had agreed to sell a majority stake to a consortium led by the parts maker Magna, a bid that was supported by a large share of money from Russia's state bank.
GM says the eleventh-hour decision to keep Vauxhall-Opel has been made because it can now see its way to being profitable in the US. This is possible because earlier this year it went through bankruptcy in the States, slimmed itself down and shook off debt. It also says the car business is turning the corner in Europe.
It certainly makes sense for GM to keep its European arm. The engineers here had developed both the Insignia and Astra, cars that were being planned for use all over the world under various GM brands.
If the engineering of those cars had leached away to Russian hands, GM's competitiveness would have been compromised. For instance, GM would have wanted to continue selling its Korean Chevy Cruze in Europe and Russia (a big market these days). But if a cheap version of the Astra were to be built in Russia by Magna, the Cruze would have lost out. And GM would have shot itself in the foot.
So GM never really wanted to sell the European arm. It was forced to put it up for sale when it went bankrupt and got support from the US Government. Taxpayers there wouldn't have wanted their dollars going to prop up workers here.
Now GM is out of bankruptcy, rather more quickly than many people thought it would be, it has more control over its strategy again. Its bosses are talking of beginning to float ‘new GM' shares on Wall Street next year, and use the money to begin repaying the roughly $50 billion (about, deep breath, £31 billion) of US taxpayer loans.
But today's news certainly doesn't mean business as usual for Vauxhall and Opel. For years they have lost fortunes in bad times and made only slim profits in good times. That's got to change. GM needs to have a solidly profitable European arm. So difficult days await the 55,000 workers in Britain and the rest of Europe, because factories will have to be shut to make sure that Opel and Vauxhall have a cost base that's realistic for the number of cars they can sell.
And more political battles will affect the result. The German Government wanted to protect German factories and jobs. Magna was the bidder that promised to do that, at the likely sacrifice of jobs in Britain and Spain. In return it was promised financial help by Chancellor Merkel's government.
That support is now in jeopardy. Vauxhall-Opel will likely enter a time of horse-trading again, to see whether the German, British or Spanish governments will give aid. In return those countries will be seeking promises over jobs on their soil. Promises that might rob GM of the competitiveness it has lacked for so long.
Paul Horrell
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Vauxhall still exists?!
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According to a Vauxhall salesman in Derby, Mikeado, you'd probably start seeing the new Astra on roads by the end of this month. Vauxhall will never be a premium marque like BMW, Mercedes, Audi or Jaguar, but like Ford and Citroen I think they have aspirations of being a cheaper alternative whilst offering the same premium quality as their Teutonic peers. I think a lot of companies have that aspiration, actually. The Insignia is a world away from everything Vauxhall have produced before and I think right now is the time, in my opinion, for GM to stick close to them and give as much support to the company and the workers as possible. 2010 might be a good year for Vauxhall if they revamp the current lineup. Any news on a Corsa or Tigra replacement? Perhaps a VX220 ressurection?
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What about Saab now?
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Aren't Saab owned by Koenigsoegg?
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GM seriously lost their way somewhere around 40 years ago. Recently, they've started to make much better cars that people might actually buy. Unfortunately, many customers don't buy a car based on this, and that is where you get into brand loyalty issues. Their reputation has been tarnished, and they did that to themselves. It will probably take quite some time to gain their reputation back. Their new cars may be "as good as" the competition, but they also cost as much. Many potential US buyers of cars like the Malibu will still probably end up buying a Camry or Accord instead.
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Yes, I think the Saab deal was signed and confirmed a few months ago, so I guess that is still going ahead. As for Vauxhall/Opel, I'm not entirely sure how much longer they're going to survive under ANY kind of ownership, let alone GM. I mean, look at new car sales figures! They're still at rock bottom, and I'm happy to predict they're going to stay there for some time. It's going to be interesting to find out what shape the car market's going to be in when we finally get out of this!
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It's a kind of double edged sword really, isn't it? I mean, people try their best to make the best cars they can and yet in order to do this they have to increase the price to the point where typical Vauxhall owners cannot afford them anymore, and as you said DJ05, this isn't a unique problem to Vauxhall; it's a problem with the whole car world save for maybe the Eat Asian makes, and with them you tend to get what you pay for.
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What I see is that the business may be saved for today, helping GM in the short time. Then in several years done the road the whole sorry lot will collapse in debt again, leaving us exactly where we are now. To be realistic the market is pretty over saturated...
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What about them being sold to Aston Martin, wouldn't that be wicked? And sales are sky high and "i see far fewer Insignia's than Mondeos" They have been out FOREVER. Insig's only came out this year.
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I don't think it would be wise to sell them to Aston, John. The whole reason Aston survive is because they make a set quota of vehicles every year for a specific clientele rather than mass produce (like Morgan, Bristol, Rolls Royce, etc) -- at the minute with the current economic climate, with Vauxhall in Aston's hands, both of the companies would go down the swanny, and the last thing we want to do is see Aston Martin die.
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thank god.who would want vauxhall and opel being sold to russia? about the markets being over saturated and the brand image being tarnished GM could try selling Opel/Vauxhall cars in rapidly growing markets like China and India.GM already has a strong presence in China,but trying to sell cars in that side of the world would mean focus shifting away from Europe,most probably resulting in the shut down of plants there.What GM should do is maintain a presence there and sell what cars they can and try and go for big volumes in the Far East.maybe the money they could potentially make there could be used to prop up and revitalise the European operations for the company.. vauxhall/opel should instead compete on a lower price footing and try to project themselves as solid reliable value brands against the sort of competition they can handle[suzuki,seat,etc].and if all else fails they should sell their cars in Ukraine and Romania as luxury vehicles!
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thank god.who would want vauxhall and opel being sold to russia? about the markets being over saturated and the brand image being tarnished GM could try selling Opel/Vauxhall cars in rapidly growing markets like China and India.GM already has a strong presence in China,but trying to sell cars in that side of the world would mean focus shifting away from Europe,most probably resulting in the shut down of plants there.What GM should do is maintain a presence there and sell what cars they can and try and go for big volumes in the Far East.maybe the money they could potentially make there could be used to prop up and revitalise the European operations for the company.. vauxhall/opel should instead compete on a lower price footing and try to project themselves as solid reliable value brands against the sort of competition they can handle[suzuki,seat,etc].and if all else fails they should sell their cars in Ukraine and Romania as luxury vehicles!
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thank god.who would want vauxhall and opel being sold to russia? about the markets being over saturated and the brand image being tarnished GM could try selling Opel/Vauxhall cars in rapidly growing markets like China and India.GM already has a strong presence in China,but trying to sell cars in that side of the world would mean focus shifting away from Europe,most probably resulting in the shut down of plants there.What GM should do is maintain a presence there and sell what cars they can and try and go for big volumes in the Far East.maybe the money they could potentially make there could be used to prop up and revitalise the European operations for the company.. vauxhall/opel should instead compete on a lower price footing and try to project themselves as solid reliable value brands against the sort of competition they can handle[suzuki,seat,etc].and if all else fails they should sell their cars in Ukraine and Romania as luxury vehicles!
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thank god.who would want vauxhall and opel being sold to russia? about the markets being over saturated and the brand image being tarnished GM could try selling Opel/Vauxhall cars in rapidly growing markets like China and India.GM already has a strong presence in China,but trying to sell cars in that side of the world would mean focus shifting away from Europe,most probably resulting in the shut down of plants there.What GM should do is maintain a presence there and sell what cars they can and try and go for big volumes in the Far East.maybe the money they could potentially make there could be used to prop up and revitalise the European operations for the company.. vauxhall/opel should instead compete on a lower price footing and try to project themselves as solid reliable value brands against the sort of competition they can handle[suzuki,seat,etc].and if all else fails they should sell their cars in Ukraine and Romania as luxury vehicles!
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then chevvy kerean cars are dung no other word describes them. small fiats are much better than they are. as for vauxhall they always looks rubbishier than a ford and a peugeot has more flair and vws depreciate less. in fact i think gm should just give up and stop making rubbish cars
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The funny thing is, they have. But no-one believes them.
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thats just stupid. If they sell vauxhall, everyones a winner because a rich person will become famous because they own vauxhall, vauxhall will have more money to waste, GM will also have more money and we'll probably get better cars from vauxhall. Seemples! The Insignia and Astra are apparently good (not that I'd know) so vauxhall are on a good run. The obvious thing to do is risk everything and sell the company to someone who doesn't know what he's doing! The new TG magazine is brill!!!(RANDOM). I'm getting on your nerves now, aren't I?
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GM has a big advert campaign in the US, right now. 60-days, money back. Don't like it after 6 weeks? Get your cash back. Don't like it when your neighbor in a Fiat 850 Spider waxes your rear in a race up I-5? Bring it back. Pretty daring for a car company! Is Vauxhall offering any sort of incentive to buy their cars?
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Mr 'The Monk' open your eyes, please. Ford and Vauxhall are german cars! Ford is designed and engineered in its european headquarter in Cologne, Germany. And Vauxhall is a copy of german designed Opel... with a bristish logo. The griffin is actually the only british designed part of vauxall.
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Open Car Bar
Mikeado commented on this article
04 November 2009
Well, with the two new cars they should be off to a good start, but I see far fewer Insignias than Mondeos, and no new Astras as yet (are they out now?). Maybe image still lingers a little too much for some people and the badge is still considered uncool, or the design still isn't captivating enough. Competition is stiff too, though.
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