Euro factory will close, Chinese factory will be built, say reports
7 July 2009

Beijing Automotive Industry Corp (BAIC) will close a European factory and build an Opel factory in China andif its bid for Vauxhall/Opel succeeds, according to reports.

BAIC has put in a bid for 660 million Euros (£568 million) for Vauxhall/Opel.

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Initial reports in the Financial Times newspaper suggest it would shutdown Opel's Antwerp plant in Belgium and cut Opel's workforce across Europe.

The Chinese carmaker would then open Opel's first factory in China in 2012, building models targetted at the Chinese market.

BAIC wants a 51 percent stake in Opel and its British sister brand Vauxhall, leaving GM with 49 percent.

It says its plan for the European unit of General Motors will need less state aid than a rival bid from Magna International.

BAIC says it would need 2.64 billion Euros (£2.3 billion) in financial aid from Berlin and the German states where Opel has factories. Magna is seeking 4.5 billion Euros (£3.8 billion) in state aid for Opel.

BAIC's chances hinge on a failure of GM's negotiations with Magna. The parts supplier has the backing of large parts of the German government and regional politicians.

GM and Magna have set a target of 15 July for agreeing on the sale of a majority stake in Opel.

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