GM CEO Henderson in Germany discussing Opel future

AP News
Posted: Nov 09, 2009 4:28 PM

The chief executive of General Motors Co. met with leaders of its Opel unit on Monday to discuss the European subsidiary's automaker's future, a week after GM abruptly decided to keep it instead of selling a majority stake.

Fritz Henderson wanted to get a firsthand look at the situation at Adam Opel GmbH's headquarters in Ruesselsheim, just west of Frankfurt, said Opel spokesman Ulrich Weber.

Monday's talks ended without the emergence of any clear plans for the future of Opel's five plants in Germany, or those elsewhere. Henderson will hold more talks Tuesday, including with the head of the company's employee council leader.

Also Monday, the head of GM's engineering operations in Detroit said it would have been difficult to separate Opel from the rest of GM had the sale gone through. Mark Reuss, GM vice president of global vehicle engineering, also feared the loss of technology to other companies despite safeguards that were written into the agreement.

"It would have made everything harder" if the sale proceeded, Reuss said in an interview. "The capability that we have there is one of the deepest that we have in the company."

GM's next-generation of global midsize cars is based on an Opel design, as is its new compact, the Chevrolet Cruze.

Opel also contributes a lot of safety research as well as fuel cell and battery technology, Reuss said.

"I'm not saying we would have lost all of that. I don't know," Reuss said. "I'm really happy that we're keeping it."

GM's board decided last week to keep Opel and its U.K. based sister brand Vauxhall, instead of selling a majority stake to a Canadian car parts maker Magna International Inc. and Russian lender Sberbank. That deal was backed by the German government and Opel workers.

The announcement not to sell was followed by GM saying Friday that its European boss, Carl-Peter Forster, would leave the company.

German weekly Manager Magazine on Monday reported that Forster would become the chief executive of Tata Motors of India. Tata spokesman Debasis Ray declined to confirm, saying only that "Tata does not comment on speculation."

Henderson was accompanied at the meeting by Nick Reilly, director of GM's international operations.

Opel employees and the German government are especially anxious to hear what GM's plans are for the company. General Motors employs some 50,000 people in Europe, the bulk of which are in Germany. The German government had backed the Magna plan financially because it foresaw the least job cuts.

German Economics Minister Rainer Bruederle told ZDF Television Sunday that it was uncertain whether GM could deliver a sustainable concept for the European operations in the short term.

"I'm also very skeptical whether the company, which handled this so badly, has new ideas overnight."

Bruederle also said there was no guarantee that GM would get any help from the German government for its restructuring. No talks with German government representatives were planned, ministry officials said.