Washington - US carmaker General Motors said Wednesday it was confident it could silence the skeptics over its surprising decision to keep European subsidiary Opel, which has drawn sharp rebukes from the German government. John Smith, GM's vice president who led the Opel talks over the past year, said the German reaction was "understandable" but he insisted the Detroit-based manufacturer had the best plan to keep Opel afloat.
GM's board on Tuesday scrapped a deal to sell the subsidiary to Canadian-Austrian parts-maker Magna, ending months of wrangling with European governments.
Smith said GM decided that Opel was simply too big a part of its global operations. GM's own position was also "significantly different and vastly improved" from when it declared bankruptcy earlier this year.
Germany's government and labour unions, which had strongly supported the Magna deal, slammed GM's turnabout and demanded GM pay back some 1 billion dollars in emergency loans. Economics Minister Rainer Bruederle called GM's behaviour "entirely unacceptable."
"I can well imagine and well understand the reaction that is occurring today in Germany as we have abandoned selling the company to any investor," Smith said in a conference call with reporters.
But Smith insisted GM's own restructuring plan would be similar to Magna's and require less money. A new proposal would be presented "very soon" and he was confident GM could reconcile its differences with Germany's government and labour unions.
"If they liked the Magna plan, I believe they will also like the GM plan," Smith said.
