BAW plans for Chinese Opel Factory
In a bid submitted to GM last week it was revealed that the current preferred suitor for Opel, Beijing Auto Works, has plans to build a new factory to produce Opel products in China and will also use a German factory to export products to China.
Should BAW win control of Opel, work on the factory would expect to begin in mid 2010, and would be ready to produce cars by 2012. In the meantime BAW would close an Opel factory in Antwerp, and at the same time cut Opel’s workforce across Europe.
BAW’s bid is based on 2.64 billion USD in state loans for the car maker, and allowing GM to keep 49% of Opel stock, which could mean an eventual buy back by GM in the future. The deal has yet to be inked, as Magna are still the preffered bidder for Opel, but talks between Magna and GM have failed, but could be restarted at any time.
One major sticking point for GM, is BAW’s plans for an Opel China
factory, which would make GM’s former ‘son’ its competitor in the worlds hottest automotive market.
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Really, BAW is now the preferred suitor for Opel?
Where would this leave the Buick Regal and also Buick plan for it’s new HRV? As I commented on the HRV spotted post it would be a licensing nightmare.
Where would it leave SAIC, who were reportedly ready to license the Insignia platform for a new 750?
GM wants to close its negotiation with Magna ASAP, and is only using BAIC as a leverage against Magna to pressure them into accepting sales on its own term.
There is no way BAIC could buy out Opel, unless it comes up with 2.6 billion Euros of its own money to shut German government out of negotiation process, as both German government and labor union oppose the BAIC bid even more fiercely than Fiat’s bid. Germans fear BAIC would pull a Ssangyong on Opel, that is to keep Opel alive just long enough to loot all the technology, then let Opel go bankrupt and pick up Opel plant equipment at the liquidation auction.
Ok, that’s what I thought (that Magna and Co. still had the preferred bid).
As for the various new China Buick models, the Opel Insigna and Astra are all using GM’s “global” platforms right? I would assume that GM would retain the rights to use and license those platforms.
@ Gerald
> As for the various new China Buick models, the Opel Insigna and Astra are all using GM’s “global” platforms right? I would assume that GM would retain the rights to use and license those platforms.
Yes, GM would still be able to access platform engineering work of Opel, but must pay a royalty for the access right. In addition, GM would have to take the platform and do the product engineering at somewhere else(namely Daewoo), as Opel would be too busy engineering its own and GAZ brand models. This is why GM is refusing to even discuss the sales of Daewoo to Korean government, as GM must keep Daewoo to get its cars engineered(US engineering center only engineers trucks and Cadillacs)
Terms of Magna bid agrees that Magna and GAZ would stay out of US and Chinese markets. In return, GM must transfer some tech to GAZ, because it is the Russians that are actually funding this deal. Previously GM was hesitant, but GAZ is obviously considered much less threatening to GM than a Chinese maker like BAIC. Transferring tech to BAIC and then competing with Chinese-manufactured Opels in China? That would basically a suicide for GM.
So GM doesn’t want to sell Opel to BAIC, and neither do German government and labor unions.
According to latest news report. Belgium’s RHJ is close to singing the Opel sales deal for 300 million Euros for 51%, less than half of what BAIC offered for same stake.
It kinda illustrates how much GM fears Chinese, as they would rather sell Opel to Belgians for less than half the price offered by Chinese.
Struggles with both Chrysler, and Daimler testifies to the questionable cross-border/cultural skills of BAIC management.
Yes, Hyundai speaks another language too, but it is a more familiar one.