Calls grow for more help for German automakers

November 18, 2008 - 0:0

BERLIN (AFP) –- Calls grew Sunday for Berlin to do much more to help Germany's entire auto industry a day ahead of a crisis meeting between Chancellor Angela Merkel and desperate executives from cash-strapped Opel.

Opel, which employs almost 26,000 people in Europe's biggest economy, said on Friday it needed the German state to guarantee loans from banks as its U.S. parent company General Motors (GM) struggles to stave off bankruptcy.
This followed an announcement from GM, which together with the other Big Three U.S. auto titans Ford and Chrysler is clamoring for U.S. government help, that it would request state help in countries where it had major operations.
Earlier this year, Congress approved a 25 billion dollar loan guarantee program to help the Big Three but the firms have asked lawmakers for the same amount again to survive a steep U.S. economic downturn.
GM's CEO Rick Wagoner said last week that the company would need state help before Barack Obama becomes U.S. president in January or it would run out of cash.
Germany, with four main production sites, accounts for almost half of GM's 55,600 employees in Europe, where almost one in ten vehicles sold carries a brand owned by GM like Opel, Vauxhall, Saab or Chevrolet.
According to press reports Opel, which GM has owned since 1929, needs up to two billion euros (2.5 billion dollars) in guarantees and this is set to be covered by the federal government and by some of Germany's 16 states. Merkel said in Washington, where she was attending a G20 meeting on the global financial crisis, that she would meet top executives from Opel on Monday.