The World from Berlin Debating Opel's Fate

German carmaker Opel, a beleaguered subsidiary of threatened US automobile giant General Motors, is expected to present its own restructuring plan on Friday. As the doomsday clock ticks, German editorialists continue to mull the company's fate.


Opel protest near Frankfurt: "A Europe without Opel would be like a car without a motor."
DDP

Opel protest near Frankfurt: "A Europe without Opel would be like a car without a motor."

Thousands of workers at General Motors German subsidiary, Opel, gathered for a massive protest at the company's headquarters in Rüsselsheim near Frankfurt on Thursday. Employees are worried that Opel will be shut down as part of its American parent company's restructuring. They carried banners with slogans like "Free Opel" and "Europe without Opel/Saab/Vauxhall would be like a car without a motor." Their immediate concern are plans by GM to close down several Opel plans.

German Vice Chancellor and Foreign Minister Frank-Walter Steinmeier also spoke at the rally, where he said he would do all he could to help save Opel. "This is a fight for jobs and I'm fighting without any reservation for you," Steinmeier told workers. Noting that the company has built cars in Germany since 1899, he added: "Opel is a part of German history. We've got to defend that history. ... This is about more than Opel. It's about the future of the car industry in Germany. The car sector isn't just an ordinary industry here. It's the backbone of our economy."

Given that Steinmeier is running as the center-left Social Democratic Party's candidate for chancellor against incumbent Angela Merkel of the conservative Christian Democrats -- a party that shares power with the SPD in the current coalition government -- the foreign minister's visit was not uncontroversial. Conservatives claim the visit was nothing more than a stump speech for his campaign, and an editorial in one of Germany's leading papers suggests he has taken a significant political risk given that he has no plan to rescue the ailing carmaker.

Graphic: GM in Germany and Europe
DER SPIEGEL

Graphic: GM in Germany and Europe

Accompanying the protests on Thursday were media reports that the Germany-based Opel dividsion would now need €5.6 billion in bridge loans in order to secure its future. Opel's German management is expected to unveil a restructuring plan to its board on Friday that will likely result in thousands of jobs being cut and the closing of at least one plant. The plan is key to securing aid from the government Berlin.

Editorialists on Friday continue to debate Opel's future, as they have throughout the week -- should the state intervene or should the company be allowed to collapse and the jobs of its nearly 30,000 German workers slashed?

The center-right Frankfurter Allgemeine Zeitung writes:

"Adam Opel built sewing machines before he became an automobile producer and the company he founded has been a part of General Motors since 1929. Somehow, though, people here have created the belief that Opel is part of the origins of the German automobile industry. People across Germany are looking to Rüsselsheim, where Opel is threatened with collapse and its thousands of workers could lose their jobs, with great compassion. But that shouldn't deflect attention from reality."

"Unions and politicians are calling for a European business model that would make it possible for Opel to operate in the future as an independent company. People have been ruminating on how that might happen since Christmas. The reality, though, is that Opel is far too interwoven with its mother company. German rear axels are used in cars built in America, small Japanese cars carry the Opel brand and Opel-designed cars built by GM Korean subsidiary Daewoo are sold under the Chevrolet brand. Without any recognizable resistance from its managers in Europe, GM has made one bad decision after another. … Opel, for example, was forced to turn over its patents to a GM shell corporation and must pay a licensing fee for each car it produces."

Graphic: GM's 2007 results
DER SPIEGEL

Graphic: GM's 2007 results

"As bitter as this may be for the company's workers: Opel builds cars that are technically good, but it has too many factories and a parent company that wants taxpayers to bail it out. This cannot be permitted to happen. According to Chancellor Angela Merkel, Germany has an interest in helping companies that 'have good prospects for the future and have solid business structures … to get through the crisis.' When there are doubts, though, the facts are helpful: In GM's European business, of which Opel comprises the greatest share, the company last year lost $2.9 billion. The company looks set to record even greater losses in the future."

The center-left Süddeutsche Zeitung writes:

"The more serious the economic problems, the more concrete the expectations are that politicians will take action. That's why Steinmeier took a real risk by visiting Opel, since he didn't bring anything with him except himself. With all due respect, that's not much in the view of an Opel worker who fears losing his job."

"Steinmeier criticized management at General Motors and he expressed his support for the workers while pushing for a European solution to the GM crisis. But that would also serve the purpose of taking some of the responsibility away from the state. Still, the public perception is that the government is ultimately responsible. And it's an image Berlin has perpetuated in recent weeks, because any government that systematically rescues banks is going to have difficulty explaining why it can't bail out Opel....Steinmeier hasn't profited in any way with his visit to Opel at Rüsselsheim. Instead he has left with greater liability."

The conservative Die Welt takes the latest developments at Opel as an opportunity to riff on Germany's labor unions:

"It's paradoxical. In the midst of a crisis, the unions are out trumpeting their horns. At the Opel plant in Rüsselsheim on Thursday, members of the IG Metall metalworkers union very confidently expressed their power with the support of the vice chancellor. And this weekend, the Ver.di service union is going to start its next collective bargaining talks for civil servant pay in Germany's state governments. The union is calling for a lavish salary increase of 8 percent."

"In past economic downturns, exactly the opposite happened. Since the dawn of the age of globalization in the 1990s, each successive crisis has pushed unions into the defensive. Companies threatened to move their operations to countries with lower labor costs and unions were often brought to their knees. But this crisis has been totally different. There's been a paradigm shift in both politics and society. Capitalism is now viewed suspiciously by most. And the issues that only a few years ago were only espoused by the left-wing fringe of the Social Democratic Party are now en vogue even with the conservative Christian Democrats. Minimum wages, economic stimulus packages and even expropriation are now being discussed as if they were never taboo. "

-- Daryl Lindsey, 1:45 p.m. CET

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