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GM Subsidiary Opel Needs $7 Billion in Aid

General Motors subsidiary Opel needs $7 billion of aid, Vice Chairman of General Motors, Bob Lutz, told CNBC at the Geneva Motor Show.

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GM would be able to supply about $3 billion, with an extra $1 billion coming from “savings and sacrifice” from the Opel workforce, Lutz said, but the remaining $3 billion would need to come from state aid.

General Motors would favour a European company taking a percentage stake in Opel to help alleviate the carmaker’s problems, he added.

But one company that won’t be looking to take that stake in Opel is Daimler, whose CEO Dieter Zetsche told CNBC that he is not at all interested in involving Daimler with Opel or GM.

Zetsche also said that while he had no problem with short-term loans to companies struggling with liquidity, the government has no place helping carmakers with fundamental structural problems. “This would certainly distort competition,” he said.

German Finance Minister Peer Steinbrueck expressed anxiety about a possible bailout.

On a TV show late Monday evening, Steinbrueck said that Opel lacks any type of a feasible rescue plan.

He also postured that aid supplied to Opel might end up in the US bailing out parent company General Motors.