Unlike the US, Germany unlikely to bail out automaker
Merkel, in visit to headquarters of GM's Opel unit, says that direct aid is unlikely.
When the survival of embattled carmaker Opel – and that of his town – are at stake, Roman Catholic priest Balthasar Blumers has no qualms about crossing the lines between religion and politics.Skip to next paragraph
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"People are at the center of our system, and every one of them is equal in value," the cleric said Saturday, as he led hundreds of residents on a solidarity march with the company ahead of Chancellor Angela Merkel's visit to the flagship Opel plant.
Just days earlier, Ms. Merkel, backed by her economy minister, had said the company should not expect special treatment, as it wasn't "system relevant."
But on Tuesday, Merkel told 3,000 Opel employees that her government would help secure the company's future by providing potential investors with loan guarantees. Opel, which is owned by troubled General Motors, has said it needs €3.3 billion ($4.5 billion) to avoid bankruptcy under a plan that foresees more autonomy from Detroit and prevents aid money from flowing to Detroit.
Under pressure not to intervene from the conservative wing of her party, Merkel ruled out having the state take a direct stake in Opel. "We must try to do everything to find an investor who, of course with state support ... builds a long-term foundation and who believes in Opel," Merkel said. "For all that the state can do, it never was the best entrepreneur."
But Vice Chancellor Frank-Walter Steinmeier, Merkel's Social Democrat rival, called for direct participation. At stake, he said, was the future of a German icon.
How politicians handle the Opel crisis, balancing national interests with local fallout, could signal how they will tackle other economic challenges.
Opel employs 16,000 people in this town of 60,000 near Frankfurt. But more than 40,000 jobs could be on the line in the region if the company goes under, making the political stakes high six months before national elections.
Workers and Germany's car-dealer association have proposed a minority stake in the company if it becomes a stand-alone operation. Workers have proposed forgoing some wages in return for a stake, while the dealers' association has said it would build up a fund by taking an amount from each Opel car sale.
Susanne Blazejewski, of the European University Viadrina in Frankfurt (Oder), says that unless an investor comes along, the demise of Opel is inevitable. "It has a long tradition, but it's just a company," she says. "If the government saves the company, other companies will stand at the door.
"What the government can do," she says, is "cushion the fall."
From market town to industrial icon
Until the mid-19th century, Ruesselsheim was a small market town. But in the 1870s, a locksmith named Adam Opel transformed it into a industrial icon, opening a factory making such revolutionary tools as the sewing machine, bicycle, and eventually the car. By 1911, his factory was the world's top producer of bikes. In 1937, it manufactured 2 million bikes. A breakthrough came when Mr. Opel's five sons established Europe's first assembly line, making cars affordable for ordinary people.
"Ruesselsheim is Opel," says Wilfried Pfeifer, a fourth-generation Opel worker whose great-grandfather assembled bicycles, as he pushed his twin sons' stroller during the march Saturday.
At its peak in the 1960s, the company employed 53,000 workers. The city invited guest workers – from Italy and Greece first, and then from North Africa. And they still influence the identity of the town; half the population has foreign origins.