EU, GM to Talk on Opel Future in Brussels

General Motors representatives will meet with EU officials and European economic ministers next Monday in Brussels to talk on Opel's future. Basically, the European Commission is attempting to prevent a potential bidding competition between countries that are hosting Opel factories and are willing to provide more money to General Motors in an effort to protect local jobs.

This is actually one of the causes that have led to GM's decision to retain Opel possession. The European Union asked Germany to allow General Motors reconsider Magna's takeover proposal as there were signs that the country might favor the Canadian - Austrian partsmaker in an attempt to prevent a massive job cut.

General Motors is now believed to cut around 10,000 jobs in Europe, with a potential plant closure now in consideration. Still, the plan is far from being finalized and a complete proposal will be submitted in three weeks, GM Europe interim head Nick Reilly said in a statement a few days ago.

Curiously, Opel still has enough money to survive until the first quarter of 2010, with Reilly saying the cash reserves are amounting to $2.5 billion. Meanwhile, General Motors has to pay back the loan it has received from Germany in July.

Negotiations with EU countries are currently under way and General Motors intends to inject its own money into the shake-up but it also hopes to receive money from governments hosting Opel factories. The United Kingdom is one of the countries that expressed support for GM right from the beginning but also asked for an early look on GM's restructuring plan.

On the other hand, rumors are hinting that Germany might reject GM's loan application, mostly as a result of its decision to keep Opel. Germany constantly backed Magna International and even agreed to grant a 4.5 billion euro loan to the Canadian - Austrian partsmaker if the deal went through.
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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