Magna Says It Has Enough Money to Buy Opel, Fires 725 Workers in Canada

The long stopry short: Magna International has recently been linked with an Opel acquisition, with the officials of the company hinting that it has enough money to purchase the German unit. Meanwhile, Magna turns to job cuts in Canada, laying off 725 workers at its truck frame (chassis) plant in Saint Thomas, Ontario due to decreasing demand. The catch? We can't know for sure at this time but, even if the company has enough money to invest in overseas companies, it still thinks that firing employees would help it reduce loses as much as possible.

According to Just-auto.com, the temporary job cut concerns both salaries and hourly workers and will become effecting on May 4. A similar cost-cutting measure was also applied last September when Magna laid off 400 workers.

Getting back to Magna's financial situation, the company says it only wants to help Opel, hinting that it might after all purchase the controlling stake in the German automaker.

"We've got around 1.5 billion dollars cash in the bank. We can easily enter into a deal without putting ourselves in jeopardy," Magna chief executive Frank Stronach said.

"It's too early at this stage. But I repeat: we supply Opel and it's in our interest that Opel does well. The market can't be allowed to disappear. We're close neighbours, Germany and Austria have close economic ties. It's about saving jobs and creating new ones," he said.

Opel is currently seeking up to 3.3 billion euros from European governments to get through the crisis. Furthermore, GM Europe has put Opel up for sale, with several parties reportedly interested in an acquisition, including Italian automaker Fiat.