Ford Stands Against Opel and Vauxhall State Aid

Ford Motor Company announced it is against state aids for General Motors’ European brands Opel and Vauxhall. "We believe companies should pay for restructuring themselves," said Wolfgang Schneider, head of legal, governmental environmental affairs of Ford Europe. "State aid maintains weak players that should not be in the market,” added the official, quoted by the Automotive News Europe.

General Motors is looking for about EUR1.8 billion (USD 2.4 billion) in state aid from European countries that have Opel or Vauxhall factories, including Germany and the United Kingdom which are currently hosting the biggest plants. The money would be spent on a turnaround plan that aims to send home 8,300 of its 48,000 workers, reduce capacity by a fifth and return the company to profit in two years.

Ford’s Schneider said that gaining government funds would be a wrong thing to do, since state aid for automakers and suppliers had prevented restructuring in Europe’s auto industry, which struggles to deal with a 30 percent overcapacity. He explained on a conference call with journalists on Thursday that state aid in the form of soft loans and cash injections was not good for the overall health of the industry or companies such as Ford that restructured early.

It is not the first time when Ford criticized government aids to European automakers. The American auto giant has also spoken against the aid to Renault and PSA Peugeot-Citroen, which were awarded 3 billion euros each in low-interest loans from the French government in February 2009. The state only asked in return that Renault and PSA Peugeot Citroen promise to safeguard jobs at their factories in France.