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GM’s head of European operations, Carl-Peter Forster, has reportedly quit following the collapse of the deal to sell Opel to Magna.

GM executive vice president David Reilly would replace Forster, said Spiegel online.

One reason cited for Forster’s departure was his disgust at the way the GM handled the Opel/Magna deal.

GM cancels Opel sale
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Autocar:

One reason cited for Forster’s departure was his disgust at the way the GM handled the Opel/Magna deal.

well of course it was! It was thee and only reason - don't be so prissy and disingenuous. The man had shook hands, had verbal and written understandings, made contractual agreements with his negotiating partners at Magna, European goverments' representatives and workers representatives only for some US Car Czar appointed pillock to toss the whole thing over. The man is a man. GM, the company he works for, reneged on a deal. He is honourable and has resigned, in disgust. Question is, why isn't his boss, Fritz Henderson, doing the same thing? He, Henderson, came out unequivocally in the end for the Magna deal, only to have Whitacre, the new GM Chairman, shaft him, publicly humiliate him, by overruling his chief executive officer. Come on Fritz, follow Forster's honourable example and flick the bird to that louse-ridden organisation; you're going anyway, as John smith and his cronies have basically pulled off a Putsch. Go with your dignity, before they push you.

Wow!  You seem incredibly p**d off about this!  So many posts with so much anger.  Do you work for Opel by chance?

No-one seems to understand the long term effect Russian ownership (yes, Magna wasn't doing it alone..) would have had on Opel/Vauxhall.   Derepaska/GAZ had plans for Opel that would not have had the Unions jumping for joy.   I spend a lot of time in Russia (Russian family) and listen and pay attention to all that goes on when I'm there. There were reports of intentions to close down European operations after 2013 and move all production to Nizhny Novgorod just to start!  So, in my view, Opel/Vauxhall had a close call and at least now have a chance of future survival.   Flame me if you like, but unless you know ALL the facts, your ire just doesn't cut it.

 

 

sorrel:

No-one seems to understand the long term effect Russian ownership (yes, Magna wasn't doing it alone..) would have had on Opel/Vauxhall.   Derepaska/GAZ had plans for Opel that would not have had the Unions jumping for joy.

I agree 100%.  It would have been a disaster for the Russians to get their hands on Opel/Vauxhall and more importantly, their intellectual property.  GM did the correct thing - perhaps in a clumsly manner - but the right thing.

Sorrel, why must someone work for a company or have a direct vested stake in order to rail against misdeeds, plain wrongdoing? GM reneged, the top man of Europe has gone, the Russian PM is having the legal aspect fine toothcombed. I am not the only one who sees it this way:

 http://www.carmagazine.co.uk/Community/Car-Magazines-Blogs/Greg-Fountain-Blog/Is-Vauxhalls-future-any-safer-under-GM

There is an alternative universe outside of Autocar's editorial line, as much as many would wish it otherwise.

Besides, if Magna/Sberbank and various unsavoury Russian oligarchs(athough they're apparently proper enough for Britain's real Prime Minister to bunk on their boats - Corfu 2008) were really getting such a wonderful deal - €4bn from the Germans and then carting it all off to any icy wastehole - why is it Magna's share price has rebounded at the news it won't be taking over Opel? You opponents of the Magna deal can't have it both ways - it can't have been an asset-stripping steal for the Canadians/Russkies and a share price depressing mal investment at the same time; make your minds up.

"carting it all off to any icy wastehole"   Clearly you know nothing about Nizhny Novgorod! 

Why do you think Derepaska and Sberbank were so keen on the deal and why they're so gutted at it's failure?  Why is Putin so upset?  

Reason:  The Russian motor industry needs a serious upgrade - poorly built Ladas and Volgas with rapidly reducing sales in favour of Korean and Chinese products.  Opel was the perfect solution to stemming the tide away from the domestic market.  Vauxhall would have disappeared altogether and Opel eventually re-badged as Volga.   Magna are lucky to be out of it, as their share price shows.

By the way, why the change of name - or is there something Freudian about the new choice....? 

 

Regardless of what might have happened to GME if the deal had gone through. It was obvious that GM had zero intention of selling OPEL and saw a chance to grab some quick money from European governments whilst showing the US treasury all the right 'cues' in scaling back global operations. They consistently kept moving the 'goal posts' to prolong the sale so that state aid would be cleared in North America, so that at the right moment they could pull the plug on the sale of GME. Their whole approach for getting state aid was based on cost to re-employ workers vs. plugging a 40Bn Dollar deficit. GM.NA have virtually no engineering expertise of their own and most Global architectures are developed by OPEL. Strange that at the beginning or the Year, GME said they had enough sustainable capital in the region of 3Bn Euro, yet 3 weeks later they were practically bankrupt and threatened factory closures if governments refused to help. GM made Bob Lutz redundant to signify the dawn of a new era, only to recently re-employ him. (I'm sure he still has a nice 7 figure redundancy package on his bank account). GM.NA management of SAAB has been abysmal at best have used their engineering in all other brands except SAAB themselves. Amazing that the only GM brand in North America not to offer e85 is the GM brand responsible for engineering it? Is that playing 2nd fiddle or just blatant mis-management? I heard recently that the SAAB engineers brought down from Sweden to Rüsselsheim developed 80% of the Insignia architecture. Have they been given any credit? I think not. Have SAAB ever been given any credit by GM for e85, XWD, Turbocharging, Gearboxes, and driving dynamics. It's fair to say no to all, yet there is enough of that technology in millions of GM products to warrant it. Carl-Peter Forster should have taken over from Wagoner not Henderson. His management of OPEL over that past years has expelled poor quality build, increased reliability, established OPEL and Vauxhall as respectable competitors in Europe (especially in UK) and above all else generated profit. GM.NA on the other hand has stripped SAAB of product, took money from GME and wasted it on half baked products that still to this day cannot efficiently be sold globally due to lack of RHD development. It will be interesting to see where Carl-Peter Forster will end up, I'd laugh my socks off if he ends up at Koenigsegg Group AB. I wish him all the best.

I agree entirely.   The way GM handled this was appalling, albeit I think the end result was the best under the cicumstances.   GM have behaved in the same way that their feared Russian businessmen do - which is without ethics or honour.  Just hope they don't do the same turn-around with Saab (although I think they don't care a t**s about Saab as their ownership over the last 20 years proves).

I too wish Mr Forster all the best and hope he turns up in some way involved with the future of Saab!

Sorrel, you'd try a saint's patience. You answer the question but you still imply it was all some devious asset-stripping plan of the Ruskies:

"Magna are lucky to be out of it, as their share price shows."

so, investors think Magna's dividends would have suffered with the takeover of Opel. So one would conclude that this was no taxpayer-funded bonanza for Magna. So for your 'devious ruskies' conspiracy theory to hold water Magna must have been hoodwinked by the devious ruskies too? My, these ruskies are so freaking clever, duping a seasoned self-made man like Stronach - give over.

What is wrong with a country buying a foreign company to access tech knowhow anyways if they have the readies? Isn't that what the Chinese did with Rover, Geely about to do with Volvo? Why shouldn't the Russians through their state bank acquire a state of the art car maker? Renault has refused to stump up cash for its share of VAZ. Putin, the state bank and the Russian business community would have preferred to bypass the middleman - Renault/VAZ - and go direct to the tech source. Opel would have benefiited from access to the latent, potentially huge Russian/CIS market, which will now be off limits to GM owned GM Europe. It would have been a win-win for German/Russian business and trade, which by the way is crucial to the Russian economy's advancement.

By the way, as the Bank of England is printing £1bn a day at the moment and the US Fed similarly, inflation is about to take off again. especially in real valuable products - not UK hovel property -but oil, gas, oh, what the Ruskies have in abundance! With oil back above $100 the Russians will be loaded again and looking to invest and buy cars - just what Opel could have benefitted from.

PS if you don't think the actions of King/Brown will create Weimar style inflation in Britain, with petrol at £1.50/l in the new year, look at today's UK producer price data, with the price of raw materials running at an annualised 40% inflation rate. UK's f*cked mate, Russia is the future, with its energy resources - too bad some arsehole from Texas blew it for all concerned. 

Your last paragraph I agree with 100%!    Except, sadly the revenue from the oil and gas resources doesn't seem to filter down to sorting out the nation's infrastructure.  Moscow does very well out of it, of course, but to hell with the rest of the country.  Sad, because Russia has so much to offer, given the right support and a decent set of politicians (sound like somewhere we know a bit closer to home?? lol).

I remain to be convenced that the Opel/Magna deal would have been good for any of the European factories long term, but I guess we'll never know now, will we.

The problem with the Russian motor industry is not actually a lack of knowledge.  It's the inability and general apathy towards "getting it done".  This is a carry on from the Soviet times when everyone had a job for life and the main trick was to do as little as possible and take no responsibility for anything. With regards consumer products, the state viewed that as unimportant and anything, however cr*p will do - after all, there was no competition. Sadly, this attitude still prevails today and until some serious management gets involved and Russian workers get a major kick up the rear, even buying Opel technology would not have made a great Russian motor industry.  Just look at the Volga Syber....    Bought in (albeit old, but galaxys ahead of anything GAZ produces) proven Chrysler technology and they manage to botch it with poor build quality.  And, look at the mess called LDV and the Maxus which was meant to be GAZ's pot of gold for the future...   

European/North American and Russian business models have fundamental problems mixing as BP will tell! 

 

richardhead:

well of course it was! It was thee and only reason - don't be so prissy and disingenuous. The man had shook hands, had verbal and written understandings, made contractual agreements with his negotiating partners at Magna, European goverments' representatives and workers representatives only for some US Car Czar appointed pillock to toss the whole thing over.

 

 Well its late lunchtime and i cant help but rise to the bait...

Clearly you are very angry about this, but the simple legal fact of the matter is that regardless of all of the other undertakings that you list, there was no final fully executed contract for the sale of Opel/Vauxhall to Magna. It seems clear that a final draft had almost been agreed, but until it is executed it has no legal effect, and the GM Board have done nothing legally wrong. The ethics and morals of their behaviour are an entirely different and subjective matter, but that does not affect the fact that the contract had not been executed and GM was fully entitled to pull out at any time up to the point of signature.

Further, everyone keeps talking about the deals various other parties (like the unions) had alreay done with Magna, but again legally that is not GM's problem. If you chose to spend lots of money and many hours negotating with a party before it actually own the thing you are negotiating about, then you do so at your own commercial risk. That is business. Tough.

Finally, by law, the officers of GM have a legal duty to act in the best interests of GM, no-one else. By Law they were obliged to weigh the deal again, as circumstances changed. If it was the majority conclusion of the Board that the deal was no longer in the best interests of GM then they had to do what they did. It is their legal duty as officers of the company.

The simple fact is lots of people got involved in this whole process who appear to have no real experience of the sharp end of business, and they got burned. That's business. GM has done nothing wrong in law, and morals and ethics have nothing to do with it. Sad, but true.

 

 

 

 

 

 

Well said!