GM and Opel Re-Revisited

From the early days of government intervention in the auto industry, some White House policy wonks decided that the sale of Opel be a mandatory part of the GM restructuring. We thought this was a foolish move back in July when we wrote about it. Opel is a valuable brand in Europe, where there is a long history of building smaller, more efficient and fun to drive cars. The new GM board has apparently scuttled the plan to sell Opel to a group led by the Canadian parts supplier Magna International. It remains to be seen in the German government will stand up to their unions and go along with the board's directive. Retaining Opel, if labor relations can be managed, should be a smart move for GM in the medium term, as the consumer markets rebound and world demand switches to more smaller, multi-fuel vehicles.