FEBRUARY 19, 2009
GM selling off European brands?
General Motors says it is looking at selling stakes in its Opel, Vauxhall and Saab brands. The company is also believed to be looking for buyers for its Hummer and Saturn brands in the US market. The company is now working with European governments in the hope that jobs can be spared. There are 26,000 people employed by Opel at its four factories in Germany and many more jobs in the auto parts industry which depend on the company. The company has announced that it needs to cut 47,000 jobs - around 19% of its workforce - by the end of the year. It is expected that almost half of them will be at foreign factories and it is looking for government help in the various countries involved. Opel is the third biggest brand in Germany, behind Volkswagen and Mercedes-Benz.
GM has asked the US government for $16.6bn in loans to give it time to restructure. The company will run out of cash unless it receives a payment of $2bn before the end of March. GM has thus far received $13.4bn in loans in the last three months., The restructuring plan being put forward calls for the closure of five GM factories by 2012, with the focus being on four core brands: Chevrolet, GMC, Buick and Cadillac. Pontiac will survive only as a low-volume niche brand.
Chrysler too is looking for cash and promising to lay off staff.