Millions in German Opel aid bound for Russia, says report
Hundreds of millions of euros in German state aid planned for carmaker Opel is earmarked for operations in Russia, an Opel trustee with reservations about the project was quoted as saying in a newspaper interview.
“More than 600 million euros ($876 million) of the 4.5 billion (in German aid) is supposed to be used to modernize the Russian automotive industry according to the Magna plan,” Dirk Pfeil told the Frankfurt Allgemeine Zeiting in an interview, part of which was released ahead of publication on Monday.
“That means German expertise will soon be transferred to Russia and jobs will be cut here later.”
U.S. carmaker General Motors agreed on Thursday to sell a 55 percent stake in European arm Opel to Canadian automotive supplier Magna and Russia’s Sberbank. Carmaker GAZ is an industrial partner.
The Opel Trust — set up by Germany to oversee a 65 percent stake in Opel and keep it from being sucked into GM’s brief bankruptcy proceedings — approved the sale when Pfeil abstained in a vote despite misgivings about the transaction.
Magna has declined comment on the accord ahead of a news conference in Frankfurt on Monday. Final details are supposed to be worked out by the end of November.
State aid to Opel is a hot topic amid concerns that German jobs and plants may get preferred treatment over other countries in Europe like Britain and Belgium that also host GM factories.
The issue will be debated on Monday in the European Parliament at the request of former Belgian Prime Minister Guy Verhofstadt, now leader of the Liberals who make up the third-largest group in the EU assembly free credit report and score.
Magna and its Russian partners had proposed cutting around 10,000 jobs in Europe in a drive to restore the company to profit from 2011. Half of Opel’s 50,000 staff work in Germany.
The Frankfurter Allgemeine Sonntagszeitung quoted a Magna spokesman as saying around 10,500 jobs would now go in all, of which 4,500 would be in Germany. Two thirds of the cuts would target assembly-line workers and the rest white-collar staff.
WHO PAYS, WHO STAYS?
Opel chairman Carl-Peter Forster told the Welt am Sonntag weekly that downsizing details still needed to be worked out.
“We tend to ask ourselves now whether we should reduce the size of plants or close more factories,” he said.
“In the end we will be able to build around 1.5-1.7 million cars with 40-45,000 staff in Europe.”
He said the German plant in Bochum — often seen as a candidate for closing even though Magna has proposed keeping all four German Opel factories open — was “absolutely safe”.
German magazine Der Spiegel said the European Commission has discovered the Antwerp plant works more efficiently than the Bochum factory in Germany, which would make it hard to justify saving the German plant if Antwerp is closed down.
Filed under: technology by John