Written by Jose Perez
With world economy at its worst GM/Opel is trying its best to stay alive, is this a smart choice for GM?
General Motors’ tale of woe continues this week with news that its German division, Opel, is to be partially sold. The process would see Opel transformed into a joint-stock company by selling off a 25 to 50 percent stake in the company.
GM plans to keep a majority share in Opel, however selling off part of the company is seen as a necessary action - especially as GM has its hand out for government assistance in Spain, Germany and the UK.
The sale could also potentially allow Opel to begin to separate itself from the GM empire.
The reorganisation of Opel is also likely to include wage reductions for workers and restructuring throughout the company to meet lower operating cost-targets.
Opel’s application for government aid to the tune of AUS$6.6 billion, to be submitted this week, must show that the company can remain viable and must also include on outline for future business plans.
Any sale that occurs will still leave GM as primary shareholder of Opel. GM will also continue to share components, platforms and engineering programs with Opel and any new owner in the near future.