Presumably, Forster, who is now running GM Europe, has a future looking after Opel.
The chief negotiator for General Motors on the sale of Opel/Vauxhall in Europe published a blog post yesterday that in my view foreshadowed what GM thinks is a desirable outcome for the impending decision. It is a canny piece of communication in the midst of a political mess.
John Smith, a GM Group Vice President who normally looks after GM’s future product plans, is leading an effort that he says has always been about finding the “best solution”for Opel/Vauxhall. And he points out that, thus far, GM has not picked a favorite in spite of such assertions by some media outlets. For what it’s worth, in my dealings with John over the years, including when I was competing against him, I have found him to a straight talking man of his word.
Two different choices
The Opel matter has devolved into two buyer choices: The Canadian auto conglomerate Magna, which has strong European and German ties, or an investment group know as RHJI.
It is by most accounts a complicated negotiation, as we have noted before, since it will require the agreement of labor unions, regional and federal governments, financial institutions and regulators, among others, to broker a deal to save Opel. And GM needs to save Opel engineering if the reorganized company is to have a good shot at surviving the brutal car wars of this decade.
If this was a horse race, not subject to fixing, I’d handicap it this way:
RHJI is the clear favorite since is a venture capital group that will look to sell off all or most of its stake in Opel for a profit as soon as possible. No doubt GM will negotiate favorable terms for itself on the buy back. This is completely consistent with GM’s, entirely rational, desire to protect its product a plan going forward, which Opel engineering is key to.
Magna is a long shot. It’s a potential competitor to GM globally, as well as a current supplier, and the Russian financing presents possible conflicts in a market that GM is expanding in.
But the political aspects mean this is no ordinary horse race, so such simple reasoning might not apply.
Here’s how Smith views the race since he says both bids being developed “bring both opportunities and challenges.”
First the Magna bid
Smith says Magna “is clearly preferred by several politicians and the Labor Bench.”
However “the bid presented to GM varied from the negotiations we had in the previous weeks and contained elements around intellectual property and our Russian operations that simply could not be implemented. GM has partners in other parts of the world who have joint ownership of these assets…we simply could not execute the deal as submitted.”