Rüsselsheim, Germany – GM Europe and Opel have approved a long-term viability plan that will include a request for €3.3 billion in government support and €3 billion from General Motors. The plan suggests GM Europe/Opel will become profitable by 2011.
The plan, which will be submitted to government representatives in the coming days, includes €1.2 billion in structural cost reductions and requests assistance from the German government, among others. The plan uses conservative market assumptions.
“The discussion with governments is being driven by the exceptionally weak economic situation that has seriously eroded consumer demand for vehicles and shut out the availability of credit for financing operations,” said Carl-Peter Forster, president of GM Europe. “We’re moving to restructure our business with as minimal an impact on jobs as possible, but the reality is that we’re in an exceptional economic situation and the issue of plant closings must be considered.
“We will work with our labour representatives to find the best way forward in mitigating the societal impact of the restructuring, but it should be made clear that we need all three parts of the plan to be viable – the structural cost reductions, government support, and GM support. Anything short of this will not result in a viable operation,” Forster said.
The company said that it remains open to discussions on partnerships, equity positions, or other alignments that will strengthen the relative position of Opel/GM, and that Opel will remain an integral part of GM’s global operations.