• Peugeot moves to soothe German fears over Opel merger

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    PARIS: French carmaker PSA hopes to calm German fears about possible plans to take over General Motors subsidiary Opel by meeting Chancellor Angela Merkel and union representatives, it told Agence France-Presse on Wednesday last week.

    PSA chief Carlos Tavares “is very open and wishes to meet Mrs Merkel and the unions at Opel in a spirit of dialogue,” a company spokesman said.

    PSA confirmed on Tuesday last week that it was “exploring the possibility of acquiring Opel and Vauxhall,” the brandname the German firm sells vehicles under in Britain.

    News of the plans immediately sparked upset in Berlin, with Economy Minister Brigitte Zypries calling it “unacceptable” that PSA and Opel had not consulted German government officials, unions or the Opel works council.

    Opel’s powerful works council and industrial workers’ union IG Metall labelled the talks “an unprecedented infraction of all German and Europe employee participation law” in a joint statement.

    But worker representatives and elected officials are not opposed in principle to a tie-up between PSA, parent company of Peugeot and Citroen, and Opel, they said.

    “We would examine a possible purchase of Opel/Vauxhall without reservations,” the union statement added.

    “It’s comparatively unimportant if the owner is in the US or in France,” said Volker Bouffier, premier of the regional state of Hesse, where Opel’s main Ruesselsheim factory is situated.

    “We want a strong Opel factory, and we want to keep the jobs here,” he went on.

    The PSA spokesman told AFP that “social dialogue” was important to the company.

    “It’s time that this is put into effect with regard to the discussions now going on,” he said, adding that the merger talks were proceeding “quite quickly.”

    Dirty fight
    General Motors’ European division has gone through years of losses, costing the Detroit-based group around $15 billion (14 billion euros) since 2000.

    A sharp fall in the pound since Britain’s vote to quit the European Union last June sank Opel’s hopes of getting back into the black in 2016, and it ended up reporting a loss of $257 million.

    Analysts argue that GM suffers from overcapacity and a restricted product range compared with European competitors.

    Opel’s problems made media commentators less sanguine about the deal’s chances.

    “An important condition for a successful merger is missing: that one should complement the other in terms of the product range or in world regions where the two firms are active,” argued the Sueddeutsche Zeitung daily.

    But PSA and Opel mostly offer similar cars to similar customers in Europe, with little presence in the vital US market, it said.

    PSA and Opel’s overlaps mean that “in France and in Germany, lots of jobs will have to be streamlined away, and in the face of bitter resistance from the unions. It will be a dirty fight,” the paper warned.

    Founded in 1862, Opel’s lightning-bolt emblem has long been a familiar sight on German and European roads.

    At the end of 2015, the firm reported 35,600 employees, including some 18,250 in Germany.

    Opel has some 10 factories in Europe spread across six different countries.

    AFP

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