Loan Guarantee to GM for Vauxhall and Opel
Saturday, March 13, 2010 10:20
Business Secretary Lord Mandelson has a 300m-euro ($ 412m given; announced £ 270m) loan to the European arm of General Motors (GM).
The money will help in two safe operation of the automobile manufacturer Opel’s plants in Britain and Opel in Europe. Mr Mandelson told the BBC he thought the move would be the future of the Opel plants in the United Kingdom secured.
GM Opel had planned to sell after the bankruptcy protection last year, but then changed their minds. Following the announcement last week to increase their investment in brands Opel and Vauxhall to 1.9 billion, GM said it needs 2 billion euros in loans and guarantees from the European governments.
It is asking for about 60% of this sum coming from Germany, where the majority of European workers at GM are based.
GM estimates that the Opel – Vauxhall belonging to the British business – to 3.3 billion euro must be reversed. The U.S. company decided to keep Opel, rather than sell them to Canadian auto parts maker Magna, which had supported Germany.
The British government loans come from the automotive Government Assistance Programs. Vauxhall said it represented “a strong proof of the confidence in the UK automotive industry”.
GM is cutting 8300 jobs and close plants across Europe, as it tries to revive the brand again.
No jobs in the factory at Ellesmere Port in Cheshire, which employs 2166 people and makes the Opel Astra lost.
But it confirmed earlier this year that more than 360 jobs were in Bedfordshire Vauxhall van plant, 150 from his office and go 369 jobs would be lost at its Luton plant. There are have been concerns about the future of the plant Luton – the Vivaro commercial van does – about the current contract, which ends in 2012-2013.
GM also plans to invest 11 billion euros in a new product offensive “in the next five years
Opel plans to launch eight new models this year, and another four in 2011. A big drop in sales in the global economic downturn forced GM into bankruptcy protection last summer, and it caused 62% of the U.S. government.
It has since closed its Swedish Saab brand and a series of classic American car brands sold as Pontiac and Saturn. Last month, she has decided to close the wind, the operation of off-road brand Hummer after failing to a planned takeover by a Chinese company.
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