GM president and CEO Fritz Henderson has handed in his resignation. (Photo: General Motors)
After its good report card for October, General Motors has decided to reward itself: it’s keeping Opel.
GM’s Board of Directors decided today that “given an improving business environment for GM over the past few months, and the importance of Opel//Vauxhall to GM’s global strategy,” the Detroit automaker would retain its European wing despite months of negotiations with business suitors and governments, the company said in a media release.
The automaker plans to spend billions of dollars to restructure Opel and Vauxhall, its British subsidiary, and work with its labor unions to develop a plan for the company’s success, according to GM.
“GM will soon present its restructuring plan to Germany and other governments and hopes for its favorable consideration,” said Fritz Henderson, GM’s president and CEO. “We understand the complexity and length of this issue has been draining for all involved.”
GM seemed on the verge of selling Opel to Canadian parts supplier Magna, which was backed by Russian banks, until late last week when it stepped back from the lengthy talks, stating that it wanted to present the latest plan to its directors. At today’s meeting, the 13-member board decided to reverse course and keep Opel.
Henderson admitted that the economy may be challenging and that GM is just past the brink of bankruptcy, but expressed confidence in the European group’s future.
“While strained, the business environment in Europe has improved,” Henderson said. “At the same time, GM’s overall financial health and stability have improved significantly over the past few months, giving us confidence that the European business can be successfully restructured.”
More information about the restructuring plans will be forthcoming, GM said.
