Germany Might Reject GM's State Aid Request

General Motors, who's now planning to convince the German government and other officials across Europe to support the Opel restructuring process, might face serious problems trying to do this, German Economy Minister Rainer Bruederle said in a statement for Reuters. He believes the US-based manufacturer is the one who should finance the reorganization after scrapping the sale to Magna International.

"I expressed my expectation that General Motors should basically carry out the financing itself," Bruederle said in a statement after a meeting with Nick Reilly, newly-appointed head of GM's European business, and John Smith, who was in charge of the Magna - Opel negotiations.

The German official also revealed that General Motors requested 3.3 billion euros in state support and even apologized for the lack of communication before announcing the Opel decision.

According to various reports, General Motors intends to cut about the same number of jobs as Magna International, approximately 10,000 across Europe, including in Germany. Meanwhile, the US manufacturer claims EU's concerns triggered GM decision, with local regulators raising concerns that such a deal might favor Germany.

"The catalyst for all this was the EU saying you only made the money available to one investor," board chairman Ed Whitacre said. "The board did what they should have done and revisited the issue. We had to ask ourselves how we could be a global player and not play globally."

"It's been a confusing decision, but I don't think it was handled badly," he added. "The circumstances changed from the time this started. The financial part of the business got better. Conditions have changed."
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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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