Opel moving toward independence from GM?

[mustang84]

http://www.thetruthaboutcars.com/bailout-w...money-or-worse/

As the B&B rightly opined, the German government(s) have no interest in running Opel. They have a big interest in keeping Opel alive and its profits back in Germany. The usually well informed German newspaper Welt says today, loan guarantees may not be the only topic discussed with Frau Merkel: “Government support, or a disentanglement of GM’s European activities from the parent will be on the table.” Wowie: “Disentanglement.” And not just Opel. “GM’s European activities.”

[Robert Hall]

Interesting... 'disentanglement' from the American patient.

[Camino LS6]

That would be one way to keep GME out of GMNA's plans, not the way I'd like to see it happen though.

[Oracle of Delphi]

I told you some weeks back that GME was working and pushing for a plan that would spinoff GME. However GME wants to bring GM Holden and GMDAT with it, and reincorporate as a new company with it's headquarters in Zürich, Switzerland.

I kind of like the name Global Motors that has been bandied about.

[Camino LS6]

Not Holden!

We need that here.

[Camino LS6]

How would this work out, especially with the platform sharing between GMNA and GME?

Not well, most likely.

Losing the global aspect of the business could be damaging to all concerned.

However, GME may be overplaying their hand by dabbling in this possibility. If that leaves them in a more subordinate role vs. GM as a whole, I'd be happy with that.

Lots of powerplays in motion right now.

[Robert Hall]

And how about the global brands--Chevrolet and to a lesser extent, Buick? Who controls them--GMNA or GME?

[evok]

I told you some weeks back that GME was working and pushing for a plan that would spinoff GME. However GME wants to bring GM Holden and GMDAT with it, and reincorporate as a new company with it's headquarters in Zürich, Switzerland.

I kind of like the name Global Motors that has been bandied about.

This is a legal strategy to protect the assets if or when GM-NAO files for bankruptcy. Only GM NAO or GM US would file for bankruptcy. It would be similar to what Delphi did in 2005. Given the circumstances this is standard MO.

GM NAO faces two possibilities if they file.

1) If they can get financing, they will restructure the NAO operations only and preserve GM.

2) If they cannot get the financing lined up, NAO will be liquidated and something else will emerge as you discribed. i.e a new company.

Edited November 16, 2008 by evok

[CSpec]

There had better not be a competition to raise trade barriers and tariffs. That would hurt everyone and exactly the same strategy fueled the Great Depression.

[FUTURE_OF_GM]

Not well, most likely.

Losing the global aspect of the business could be damaging to all concerned.

However, GME may be overplaying their hand by dabbling in this possibility. If that leaves them in a more subordinate role vs. GM as a whole, I'd be happy with that.

Lots of powerplays in motion right now.

So,

Let me get this straight...

GME is lobbying the German government to help them abandon GMNA?!?!

Isn't that impossible? Doesn't GMNA OWN GME?

I say we allow GME to go their separate way with Opel, Vauxhall & Saab (Since that really is all the company works with anyway)

Then GMNA has shed a huge cost burden (GME will begin losing money AGAIN soon, they already barely make a profit) and eliminated brands. Then GM can leverage Chevrolet (It's global brand) and GMDAT to put GME out of business.

Chevrolet and either Saturn or Pontiac could target Opel and Cadillac could target Saab... 'nuff said.

(I could be way off though)

Edited November 17, 2008 by FUTURE_OF_GM

[thegriffon]

Not soon FOG, GME lost more money than GMNA last quarter.

Not gonna happen like that though—GM or shareholders would rightly and justifiably sue, and win, big time if someone just tried to "steal" GM's international operations like that. However, reorganizing GM into a Zurich-based holding company (probably renamed something like GM Corporation S.A.), and a subsidiary holding company (e.g. North American Motors) for the North American assets and liabilities which then files for chapter 11, is possible. The new entity would still have to raise substantial amounts of cash to be injected into North America in exchange for intellectual property (technology, designs, platforms brands) and key facilities. Shareholders, board and top management would remain the same, the listed company would just be incorporated in Zurich instead of Delaware. The remaining North American operations would effectively be spun off to creditors via bankruptcy re-organization, encompassing the assembly plants; probably Pontiac and perhaps GMC and Hummer; all North American distribution and all the franchise agreements. These would be run under contract for a time, possibly with agreements for the new GM to reacquire individual plants and facilities if certain production, efficiency and quality goals can be met. Pontiac, Hummer and other brands left with NA would either be quickly sold, or managed as independent/semi-independent operations until they are either sold, liquidated or reacquired by GM. At first all distribution would be handled by the new NA holding company, but the new GM would gradually establish new franchise agreements with the best dealers for the brands it retains. The current GM Corp. could survive as the North American branch of the new GM (like GM UK Ltd.), but almost all assets would initially be distributed to either GM S.A. or the bankrupt North American Motors. Only as contract plants and facilities are reacquired would it begin the resemble the company you know today. The aim of course would be to maximize shareholder value, and to minimize the stigma of bankruptcy.

[thegriffon]

The main problem is that both GMNA and GME would still require big cash injections—tens of billions of dollars each.

[Camino LS6]

Not soon FOG, GME lost more money than GMNA last quarter.

Not gonna happen like that though—GM or shareholders would rightly and justifiably sue, and win, big time if someone just tried to "steal" GM's international operations like that. However, reorganizing GM into a Zurich-based holding company (probably renamed something like GM Corporation S.A.), and a subsidiary holding company (e.g. North American Motors) for the North American assets and liabilities which then files for chapter 11, is possible. The new entity would still have to raise substantial amounts of cash to be injected into North America in exchange for intellectual property (technology, designs, platforms brands) and key facilities. Shareholders, board and top management would remain the same, the listed company would just be incorporated in Zurich instead of Delaware. The remaining North American operations would effectively be spun off to creditors via bankruptcy re-organization, encompassing the assembly plants; probably Pontiac and perhaps GMC and Hummer; all North American distribution and all the franchise agreements. These would be run under contract for a time, possibly with agreements for the new GM to reacquire individual plants and facilities if certain production, efficiency and quality goals can be met. Pontiac, Hummer and other brands left with NA would either be quickly sold, or managed as independent/semi-independent operations until they are either sold, liquidated or reacquired by GM. At first all distribution would be handled by the new NA holding company, but the new GM would gradually establish new franchise agreements with the best dealers for the brands it retains. The current GM Corp. could survive as the North American branch of the new GM (like GM UK Ltd.), but almost all assets would initially be distributed to either GM S.A. or the bankrupt North American Motors. Only as contract plants and facilities are reacquired would it begin the resemble the company you know today. The aim of course would be to maximize shareholder value, and to minimize the stigma of bankruptcy.

That would be one amazing and confusing mess.

[thegriffon]

http://www.thetruthaboutcars.com/bailout-w...money-or-worse/

That's not how I read the reports in Die Welt, but then my German's not that good. There is concern that any money given to Opel will support American rather than German operations, and allegations by the Union that Opel is in trouble because ignorant Americans have been dictating Opel's product strategy, and that German managers would have done better. Just a bit of paranoid xenophobia really. What they really mean is the Chevrolet has been booming while Opel has been struggling for sales. The union is also claiming that GME is paying too large a share of product development for Saabs and Opels sold in the USA, and not getting enough of the profits from selling Chevrolets in Europe.

[FUTURE_OF_GM]

That's not how I read the reports in Die Welt, but then my German's not that good. There is concern that any money given to Opel will support American rather than German operations, and allegations by the Union that Opel is in trouble because ignorant Americans have been dictating Opel's product strategy, and that German managers would have done better. Just a bit of paranoid xenophobia really. What they really mean is the Chevrolet has been booming while Opel has been struggling for sales. The union is also claiming that GME is paying too large a share of product development for Saabs and Opels sold in the USA, and not getting enough of the profits from selling Chevrolets in Europe.

Good on them then...

We feel the same way...

Keep the 'german bosses' over there to run those companies and brands. Send Saab packing (out of NA) and kill Saturn. (Even though I don't really want that to happen)

[SoCalCTS]

This is idiotic. I would rather see the whole company fail than spin off GME into a separate company.

[Sixty8panther]

This is like a trainwreck that never ENDS...

(to borrow Camino's analogy)

[ZL-1]

2) If they cannot get the financing lined up, NAO will be liquidated and something else will emerge as you discribed. i.e a new company.

with the new company picking up the cash-positive pieces

[FUTURE_OF_GM]

I actually think this is a very smart move.

(As opposed to letting the entire ship sink)

I just hope GM would be willing to re-acquire or insure the future of all it's NA brands (Although I'm sure it wouldn't)

[Oracle of Delphi]

I actually think this is a very smart move.

(As opposed to letting the entire ship sink)

I just hope GM would be willing to re-acquire or insure the future of all it's NA brands (Although I'm sure it wouldn't)

Yeah you know us Germans, we're smarter than we look! :AH-HA_wink:

[carman21]

A Strong GM is the Key to the future.

Selling off Assets like Opel seem prudent at this time.

However, it may be smarter to ride out the storm.

GM does have a tidal wave of strong products sourced from Opel right now.

GM in 2012 will be a serious player again in its homeland thats a major change so the key right now is survival.

If anything were to happen selling Opel to Daimler seems the most likely scenario.

Edited November 19, 2008 by carman21

[thegriffon]

Latest reports from Germany:

Opel remains in GM's lap

Opel chief Hans Demant has issued a clear rejection of the many proposals posted for a separation of the auto maker from the U.S. parent company General Motors (GM). It was soon 80 years part of the group, because structures were grown, Demant said Tuesday on the broadcaster Bayern2. located in Rüsselsheim the second largest development center for GM with world-wide significance. The income from only 1.6 million cars sold in Europe would not be sufficient "to the overall development, we need to make to pay."

"That is, it makes no sense to a company our size quite independently to make," summed up Demant. "As part of a large group to act, has a lot of advantages, both for Opel as well as for our employees." The Frankfurter Allgemeine Zeitung reported, relying on bargaining Circles, in the worst case scenario "would even Opel 1.8 billion euros in guarantees need. GM Europe chief Carl-Peter Forster had requested the guarantee volume on Monday evening to "slightly more than one billion Euros".

Even Opel works council chief General Klaus Franz holds a secession of the car maker is unrealistic. Although he had some sympathy for this idea. "But we must see the realities in a globalized world. The central point is that General Motors would not let go," said Franz on Tuesday in Rüsselsheim. The Germany-development center have responsibility for more than four million vehicles with a future. "Without this development expertise here at the site would be General Motors for the future much worse positioned."

[thegriffon]

A Strong GM is the Key to the future.

Selling off Assets like Opel seem prudent at this time.

However, it may be smarter to ride out the storm.

GM does have a tidal wave of strong products sourced from Opel right now.

GM in 2012 will be a serious player again in its homeland thats a major change so the key right now is survival.

If anything were to happen selling Opel to Daimler seems the most likely scenario.

Why not sell part of Opel? GM does just fine with little more than half of GM Daewoo. The main concern is that no-one has any money to buy. In the current climate though they may get a good many nationalistic Germans to front up for an IPO.

[longtooth]

SolarWorld CEO says Opel takeover offer serious

Wed Nov 19, 2008 7:12am EST

http://www.reuters.com/article/marketsNews...20081119?rpc=44

Haven't seen much beyond this, but still looking.

[cyclonic]

That would be one amazing and confusing mess.

To an outsider (me) thats how GM looks right now.

Either way, this whole thing is going to result in a massive restructure and change the face of the auto industry as we know it. Though that is kinda obvious really.

So what does this mean? We can all throw our own two cents in here.

*Keep Opel design where it is?

*Move all GM group manufacturing to much lower cost centres?

*Centralise all design instead and tailor brands/platforms to suit various markets?

*Kill off/sell several brands? (ie Saab, Buick, Saturn, Vauxhall, Holden)

*Consolidate all brands worldwide into one or two brands? ie Chevrolet, Cadillac

I personally like Opel and want them to hang around.

[RedVee]

Move Chev and all the overseas ops into one group, they seem functional and can share supply as they do now. Chev gives access to the NA markets, plus all the global markets they are now in. CM? Chevrolet motors - almost sounds European - Opel, Holden, GM DAT stay as subsidaries and suppliers.