China and Russia fighting over Vauxhall
Magna which has made a serious offer for GM's Vauxhall backed by Russia's Sberbank has a competitor in Beijing Automotive Industry Corporation (BAIC) of China. So there are technically two countries bidding for the iconic GM, which is an American representative - though it is GM Europe they are bidding for.
China's bid is for €650 million for UK's Vauxhall and Germany's Opel, both from the GM stable. Even though GM had earlier rejected Fiat's bid by the RHJ group, the group has now made a revised offer which is more to GM's liking, thus forcing itself back into the race.
GM has now three bidders to select from, making the company's bargaining and leveraging position stronger. Unfortunately whichever company finally buys the business, there is going to be major downsizing and job cuts in the offing.
Though Britain's Lord Mandelson, the Business Secretary, is fighting for the around 5000 jobs in Britain, others are not so positive about the outcome. Krish Bhaskar, chief executive of the Motor Industry Research Unit, says UK factories are a lost cause, regardless of who wins the bidding.
It is most likely that manufacturing will be moving to Russia or China, and only the distribution, dealership and sales will be left in Europe. The Chinese company has the biggerst infrastructure and so is more of a threat. It should be a boon for the company that eventually takes over Vauxhall/Opel as both are strong brands in their respective countries.
[Via: globalmotors]