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  • Opel Seeks Help From German Government

    Opel seeks help from German government

    Carmaker Adam Opel GmbH, a unit of General Motors Corp, has said it will seek loan guarantees from German authorities as the financial crisis grips the European auto industry.

    Opel seeks help from German government

    The company said it would seek guarantees for an unspecified amount from the federal government and from the governments four states where it has facilities – Hesse, Thuringia, Rhineland-Palatinate and North Rhine-Westphalia.

    Chief executive Hans Demant said that the guarantees would help not only to secure jobs in Germany, but ensure the company’s future across Europe.

    The Economy Ministry in Berlin said it was already in contact with Opel, which employs approximately 25,000 workers in Germany.

    Opel’s move followed a letter sent earlier this week by Demant, employee council chief Klaus Franz and GM’s European president, Carl-Peter Forster, to Chancellor Angela Merkel in which they outlined their concern over the situation of the German auto industry.

    Opel spokesman Andreas Kroemer said last Mon that the letter called for tax breaks to buy new cars, arguing that such a move would be “socially and ecologically astute.”

    Kroemer said they also called for incentives for consumers to buy new, fuel-efficient cars and abandon cars that are more than 10 years old.

    Opel, which began building automobiles in 1899 and was acquired by GM in 1929, has three car manufacturing plants in Germany: Bochum, where it builds the Astra and Zafira or nabira models; Eisenach, where it makes the Corsa; and its main Ruesselsheim plant, where it builds the Vectra and Signum. It also produces engines at an assembly plant in Kaiserslautern.

    In 2007, the car maker built 549,349 cars in Germany, up 6% from the previous year’s 516,570.

    GM sold a total of 330,590 cars in Germany last year, including 299,239 Opel-branded vehicles. It is the third most popular brand in Germany, behind Volkswagen and Mercedes-Benz.

    Opel also builds cars in Belgium, Poland, Portugal and Britain.

    Last week, parent company GM reported a US$2.5bil third-quarter loss and said it is burning so much cash that it could reach the minimum amount required to run the company by the end of this year. 

    Source : AP Via Thestar

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