Rage Against GM Over 10,000 Planned Job Cuts at Opel

Nov. 5, 2009
German press said the Americans 'duped everyone'

Angry German workers protested General Motors' shock refusal to sell its European unit Opel and plans to cut 10,000 jobs, moves slammed as a slap in the face for Chancellor Angela Merkel.

GM wants to slash costs by 30% at Opel, which would mean the elimination of about one-fifth a workforce of around 50,000, GM vice president John Smith told a telephone news conference.

"Opel -- the big piss-take," screamed the front-page headline of the mass-selling Bild newspaper. "The Americans duped everyone."

The company warned employees and unions that it could still allow Opel to flounder if the workforce upholds its threat to refuse wage concessions -- a move blasted as "blackmail" on Nov. 5 by the German daily Sueddeutsche Zeitung.

It estimated it would need 3.0 billion euros (US$4.5 billion) in state aid, and was nevertheless confident it could secure the sum from Germany and other European countries where Opel and the British Vauxhall unit have plants.

The announcements came a day after GM stunned the auto sector by abandoning the agreed plan to sell Opel to Canadian auto parts manufacturer Magna and state-owned Russian bank Sberbank. It said it would restructure the unit itself, just hours after an unwitting Merkel gave a historic speech before a joint session of the US Congress and held talks with President Barack Obama. "It is truly tragic," wrote the Berlin daily Der Tagesspiegel, calling the decision a "stinging slap in the face" for the chancellor. "On the same day Merkel enjoyed her great triumph she also experienced her worst embarrassment. It's a disaster for German-US relations."

Obama's spokesman insisted his government had nothing to do with the about-face. But the Sueddeutsche newspaper was skeptical. "Perhaps Obama genuinely wasn't in the picture when he received Merkel in the White House, although this doesn't say much for him," it said. "Perhaps he did know something, and that would put him in an even worse light. In any case, with their inconstancy the GM managers have caused serious damage to German-U.S. relations."

Merkel's government had invested major financial and political capital in saving Opel from insolvency before a September general election which she handily won. Beyond pledging 4.5 billion euros in state aid for the ailing company, Berlin spent months shepherding a rescue deal.

About half the company's employees work in Germany and although Magna had said it would cut around 10,500 jobs, Berlin had been confident that most of the German staff would be spared.

On Nov. 5, thousands of protesting workers at four Opel plants feared the worst. Powerful trade union IG Metall said it expected 10,000 staff to take part ahead of European-wide work stoppages Friday. "We as the state will not just stand by with our arms folded," powerful Hesse regional premier Roland Koch told a rally at the main German Opel plant in Ruesselsheim, saying he would join forces with the federal government in future negotiations with GM. "We make good cars in Germany and we want to keep doing that in future."

Smith contended that there had been very little difference between the offers put forward by Magna and a rival bidder, the Belgian investment firm RHJI, and what GM has in mind for Opel. But he added: "We continue to believe that we can restructure Opel with less money than any other investor."

In Spain, where many had feared local workers would bear the brunt of a sale to Opel, the press was largely optimistic about the effects of the GM turnabout.

Britain's biggest trade union said it was keen to work with GM to ensure job cuts at Opel were voluntary while the government called for talks with the U.S. manufacturer. "I have always said that if the right long-term sustainable solution is identified, then the government would be willing to support this," business minister Peter Mandelson said.

Copyright Agence France-Presse, 2009

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