Germany Pledges To Find Opel Investor

Chancellor Angela Merkel told workers at GM's Opel that she wants a private investor to secure the embattled carmaker and pledged government aid to any new partner.

RUESSELSHEIM, Germany (AP) -- German Chancellor Angela Merkel told workers at General Motors's Opel unit on Tuesday that she wants a private investor to secure the embattled carmaker, and pledged government aid to any new partner.

Merkel was greeted with loud applause from some 3,000 workers at Adam Opel GmbH's Ruesselsheim headquarters, near Frankfurt, as she offered assurances that her government will help secure the company's future.

Opel needs a "sustainable concept for the future," she said. "Opel must, of course, be placed on a footing that does not later collapse like a house of cards."

"We must try and do everything to find an investor who -- of course with state support ... builds a long-term foundation and who believes in Opel," Merkel said.

Opel, which employs some 25,000 workers in Germany, has said it needs euro3.3 billion ($4.4 billion) from European governments over the next years to get through the economic crisis.

Merkel mentioned loan guarantees as a possible form of aid but suggested that a direct government stake was unlikely. "For all that the state can do, it never was the best entrepreneur," she said.

Merkel said a negotiating team will be put together this week, combining members of Germany's federal and state governments with investment bankers and economic experts, to discuss Opel's future with General Motors Corp. and the U.S. government.

Some in Merkel's audience were disappointed she did not go further. Armin Schild, the regional head of the IG Metall industrial union, said he had hoped she would signal readiness to save Opel even if no investor is found in the coming weeks.

"This is a time-critical affair," Schild said. He complained that Merkel's conservative Christian Democrats apparently are hesitant "to get neoliberalism out of their heads."

Indeed, Opel's fate is shaping up as a politically divisive issue ahead of German elections in September.

Many conservatives are uneasy about the idea of the government taking a stake in the carmaker, while Merkel's center-left challenger, Foreign Minister Frank-Walter Steinmeier, has advocated doing so if necessary.

"We must take care that this does not drift into the election campaign," Economy Minister Karl-Theodor zu Guttenberg, a conservative, told ARD television ahead of Merkel's visit. "That would not help the Opel employees."

Ferdinand Dudenhoeffer, the director of the Center for Automotive Research in Gelsenkirchen, said Merkel offered "nothing new."

"She offered a kind of solidarity," Dudenhoeffer said. "But solidarity without an ambitious plan doesn't work."

He said that without a plan to spin Opel off from GM entirely and support it by direct state aid, the carmaker might have to file for bankruptcy.

Merkel's government has pledged to work closely with the Obama administration on Opel's future.

On Monday, the White House pushed out GM chairman and CEO Rick Wagoner and gave the company 60 days to come up with an acceptable restructuring plan. Fritz Henderson, GM's president and chief operating officer, will be the new chief executive.

Opel employees and unions praised the appointment of Henderson, a former GM Europe boss who has discussed Opel's future with European officials.

But whatever happens in Detroit, GM Europe has made it plain that the unit needs an outside investor.

"Initial outreach to third-party investors has been promising, but GM Europe must achieve its benchmarks for labor restructuring and liquidity as soon as possible," Zurich-based GM Europe said Monday.

No investors have stepped forward publicly so far, but Guttenberg says he has spoken to several interested parties.

"There are interested parties, contrary to most rumors and speculation," he said on ARD Monday.

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