Dienstag, 31. März 2009

Super-Steinmeier saves Opel!

It's election time, and the SPD likes to get the votes of Opel employees.

The labor minister started it some time ago (as noted here), and now it's Steinmeier's turn: He published a "10 point plan to save Opel". Apparently, point 9 is missing, so it's actually only a "9 point plan". But who are we to be finicky, if his plan can save Opel?

Let's see what he has to offer (picking out some juicy morsels):

- Quote: "Opel's business plan for the next few years shows: Opel has a future!"

Hmmm. I wonder if he knows that most business plans of turnaround cases are not worth the paper they are written on?

- Creation of a new Opel-Holding in Rüsselsheim, owned 50%-1 by GM, 10 % by employees and distributors, 1-3 % by management, and the rest by the German government, German states and other European countries.

Oh my. Makes it really easy to reduce overcapacity by shutting some plants, if all relevant German states and European countries are direct shareholders...

- If Opel dies, 130,000 jobs will be lost: 28,000 Opel employees, 35,000 employees at distributor-level, 70,000 employees of suppliers

Is he aware that there are other car companies, and customers would simply buy other cars instead? Sure, if he is concerned about German jobs, he could argue that many of those other cars would be produced abroad. But surely the jobs at the distributor level are needed in any case, no matter where the cars are produced. And if -say- half those other cars are produced in Germany, that reduces the job losses in production to 14,000. As for the suppliers: Are there really 2.5 German supplier jobs on the line for every German Opel job? (and even if that number is true, the job losses would only hit to the extent that foreign cars are bought which don't use German-made parts, i.e. even in a worst-case scenario, we would be looking at 20-30,000 instead of 70,000 jobs)

Assuming an overall net loss of 40,000 German jobs, and a short-term capital need of 3 bn €, that's 75,000 € per "saved" job. For the short-term.

- Opel's pension obligations need to be honored, and the pension security fund would need to pay for them in case Opel dies.

It would be helpful to know how large those pension obligations actually are, and if they are partially funded, or only backed by Opel's production assets (i.e. factories).

- "Opel is in better shape than many people believe. The company is debt-free."

Sure. Because the "company" Steinmeier wants to create doesn't currently exist.

- "The business plan is conservative und only assumes a slow improvement of car sales over the next few years. It assumes that 2014 car sales in Germany will still be below the level of past years."

Wow. That is sooo concrete: "Below the level of past years" -> Which years? How far below? And why should we assume that German car sales will grow in the longer run? Is he aware that Germany's population is shrinking? And why does he talk exclusively about German car sales? Opel sells Europe-wide, with Germany accounting for less than 1/3 of total sales.

- "Opel needs to get access to markets outside of Europe. That's where the growth potential lies."

What bullshit! Let's get this straight: In the GM world, Opel serves Europe, and other GM subsidiaries serve the rest of the world. R&D is shared, and the cars use similar platforms. According to Steinmeier, GM would still hold a 50 % stake in Opel, and still do extensive technology-sharing, but suddenly Opel would aggressively compete with other GM units in the rest of the world. Whereas the other parts of the GM world presumably still wouldn't export to Europe, or their products would be so inferior that nobody wants to buy them here? And how would those overseas markets be served? Presumably by building new Opel factories in Asia and America? Or since when have European mass-producers exported large amounts of cars to Asia and America? (as opposed to building them locally) Can somebody please draw up a 10-point-plan that details how to save Germany from politicians like Steinmeier

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