GM's restructuring pledge raises alarm in Europe
By Edward Taylor
FRANKFURT (Reuters) - General Motors (GM.N: Quote) looks set for another bruising collision with the German government and labor unions after the U.S. automaker raised the prospect of further job cuts and plant closures at its ailing Opel subsidiary.
GM's Chief Financial Officer Dan Ammann said on Wednesday no options were being ruled out in restructuring its European operations, catching Opel's combative labor leader Klaus Franz by surprise.
The biggest drag on GM's third-quarter results came from Europe, where the automaker posted a $300 million loss.
The Detroit-based group now expects a full-year loss in Europe, where a crippling sovereign debt crisis has sparked recession fears and hit demand for cars.
GM Chief Executive Dan Akerson, who voted against keeping Opel in the GM stable at a board meeting in 2009, described Europe as a "morass."
"There is a danger that the losses will only get bigger," said Juergen Pieper, an auto analyst from Metzler Bank who believes the carmaker with the lightning bolt logo will be loss-making next year and in 2013. "The question mark over Opel's future remains."
GM infuriated German Chancellor Angela Merkel's government over two years ago when it abruptly reversed course and decided to hang on to Opel. Berlin had spent painstaking months cobbling together a deal to sell the group to Canada's Magna International (MG.TO: Quote) and preserve jobs, only to see that fall through.
The bad blood has lingered, fueled as recently as June when German media reported that GM had changed its mind again and might sell Opel after all. Continued...