GM Is Maybe, Possibly Selling Opel Again. Don't Do It!
When General Motors (GM) first emerged from bankruptcy in 2009, it spent several months engaged in an ornate, on-again, off-again sale of its main European division, Opel. There were Russians involved. There were Canadians. It was crazy. And then GM's board decided to pull the plug on the whole thing. But now Opel could be back in play.
GM hasn't done a very good job of returning Opel to steady profitability. According to the NYT, this isn't making GM CEO Dan Akerson very happy. But what are GM's realistic options?
GM needs Opel too much to not fix it
These rumors may be getting floated simply to test Opel's market value. Because there's no way GM can sell Opel right now, for several reasons.
First, many of the New General's most successful new cars are underpinned by Opel technology and platforms. The revived Buick Regal, for example. The Chevy Cruze compact sedan is also based on an Opel design.
The fact is that these cars are selling well for GM because Americans have become Germanified in their automotive tastes. The big freeway cruisers of yore -- plush, sloshy behemoths that were engineered to move in a straight line at 75 mph for hundreds of miles -- have given way to BMWs, Mercedes, and Audis. Even the Japanese have had to frisky up their ultra-reliable cars to give them a bit more of that German feel.
In this sense, GM has become a bit like the British royal family: as awkward as it may sometimes be, it's got German in its blood.
Second, Opel's potential buyers aren't really all that palatable for GM.
Who would buy Opel anyway?
The usual suspects are the ones being mentioned: Volkswagen and the Chinese. As far the latter goes, they seem to be having a difficult enough time buying Saab at the moment (more accurately, taking a stake in Saab from it current and basically insolvent Dutch owners) -- and Saab is effectively just Opel rebadged and brushed over with some quirky Swedish touches.
VW could assume dominance of its home market in a single sweep if it bought Opel. But I seriously doubt that GM would basically relinquish its European footprint to what is after all its chief global rival, after Toyota (TM).
The NYT, in its story on Opel sale speculation, also delves into the distractions faced by the German government, which when Opel was last for sale wasn't trying to manage the European sovereign debt crisis.
And wouldn't GM just lose its nerve?
In all likelihood, yes. Opel has been a technological incubator for GM for a while now. It doesn't even want Saab to fall into the partial control of a Russian financier for fear that aging tidbits of Opel will be reverse engineered for the greater glory of the growing Rooskie auto industry.
One thing that might make sense is for GM to sell some of Opel and maintain a sort of joint-venture with the company, to be able to multi-purpose technology, stay relevant in Europe, and maintain a brand that it can use to tap the Russian market.
The best company to execute this arrangement with would be Fiat, which expressed an interest in acquiring Opel before. Conflicts galore would manifest, as Fiat is steadily taking over GM's Detroit rival Chrysler. But Fiat CEO Sergio Marchionne is more of a Motown auto executive than anyone else on the globe these days, so he might understand how to play right with GM in Europe.
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