Concerns mount over Vauxhall jobs following talks breakdown

The German government was due to name its preferred bidder for GM Europe following all night talks featuring GM Europe, the three bidders for the company, German chancellor Angela Merkel and other top-level political figures.

The negotiations collapsed after GM asked the German government for an emergency loan of Euro300m (£260m).

US bidder drops out

The German economics minister Karl-Theodor zu Guttenberg also announced that one of the three bidders, US investor Ripplewood Holdings, had pulled out of the talks.

This leaves Fiat and Canadian parts maker, Magna International in the frame and both companies need more information from GM and US Treasury before a recommendation can be made, said Guttenberg.

Berlin has a big say on who will get the bid as it has pledged billions of euros in loan guarantees to the company who takes over GM Europe.

Any deal on GM Europe will have an impact on Vauxhall jobs in the UK. There are fears that Berlin will opt for a bid which favours the Opel brand in Germany with 25,000 staff at the expense of Vauxhall's 5,500 employees in Britain.

Britain's biggest union Unite has warned that unless the UK government backs GM's UK plants, thousands of jobs will be lost and the UK's manufacturing capability will be badly hit.

Unite union criticism

Unite's joint general secretary, Derek Simpson, said: "It's no good providing billions to the banks but buttons for manufacturing.

"Thousands of jobs are at stake at Luton and Ellesmere Port. Once lost they won't return, our manufacturing capability and the UK's R&D base will be left hamstrung.

"Lord Mandelson claims the government is prepared but so far there has only been talk and no action."

Lord Mandelson told the BBC he had received categorical assurances about continued Vauxhall production.

"Vauxhall's production in the US is a main revenue and profit stream for GM. There is no question of GM wanting to dispense with it," he said

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Kinnear2001 said:

	... We may be part of the European union but it is a union of nations. Each except Britain is looking out for its own. I have no doubt that when it comes to the crunch Vauxhall will be sacrificed for the greater good of Opel and Germany.
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May 29, 2009
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