‘Press reports have tended to exaggerate the state of progress, a few even suggesting the deal is done and that Magna has been selected. That’s not the case…. As noted in my prior blog post, the Magna proposal is more complex, owing to the inclusion of Russia and a third, Russian-based investor.’
‘One key point for GM is intellectual property, and this transaction should not become a pipeline, shipping valuable intellectual property to destinations unknown.’
‘There are no such issues to resolve with the RHJI proposal which, as noted previously, is both simpler and requiring less government-backed funding compared to Magna/Sberbank.’
Interestingly, Smith says ‘Opel was far more successful when focused on its home market, compared to the 90’s when it was building plants and model variants for markets on other continents.’
Reading between the lines, Smith seems to be suggesting that Opel could end up supporting the establishment of new Russian-built vehicles based on the new Delta and Epsilon platforms. New vehicles that could then end up competing on the Russian market with GM’s own Chevrolet models.
Smith also hints that a sell-off to Magna would take Opel out of the GM orbit, to the detriment of company.
‘In truth, Opel needs a close connection to a high-volume, global automobile company to take full advantage of related economies of scale as it will not survive for very long on its own.’
‘One has to look only as far as the new Insignia and forthcoming new Astra to see drivable dividends from today’s everyday product development relationship with General Motors.’
So why is the German government pushing so hard to see a deal back by the Russians? The answer might lie with the row between Germany and Russia over the supply of energy.
Recent meetings between German chancellor Angela Merkel and Russia's President Dmitry Medvedev have centred on trying to prevent a repeat of last winter’s gas wars.
A payment dispute between Russia and the Ukraine saw gas supplies cut off, a move that also badly effected Germany during what was a very cold winter.
So far this year, Germany has cut a number of deals with Russia including a £300m credit agreement and a deal that will see Siemens produce new locomotives in a joint venture with Russian railways.
So it seems quite possible that the German government is pushing the Magna-Russia takeover of Opel as another way of securing technology transfer to Russian industry, which lags desperately behind the West.
It’s no wonder GM is trying to resist its new Delta and Epsilon platforms being used as bargaining chips in a geo-political deal between Russia and Germany.