Magna Gets Much Closer to Acquiring Opel
By Brendan Moore
It looks like it’s really to happen. The board of Magna is set to approve a business plan next week to acquire Opel, the struggling German subsidiary of General Motors. That means the Canadian auto-supplier will decide to own a large automaker by July 7 if everything keeps going well.
Apparently the most pressing issue that remains is whether the new Opel gets the former Opel’s sales distribution rights for the Chevrolet brand in Russia, a promising market for Chevrolet. Opel’s acquisition of the majority of Opel is considered an absolute lock to get Opel unless it leaves the negotiations of its own volition.
Once the board give its okay, Magna is expected to pull the trigger on its financing for the deal, sit down with GM and potentially get the deal done by July 15.
The upheaval in the auto business has created scenarios that would have been considered completely fantastic even a year ago – a specialty supercar maker that had production capacity of only 30 vehicles buying Saab, GM casting aside Hummer, Saturn, Saab and Pontiac, giving up control of Opel, and then declaring bankruptcy, Chrysler declaring bankruptcy and being acquired by Fiat, an Italian automaker that pulled out of the US market back in 1983, Toyota in deep financial trouble, Penske buying Saturn, Ford emerging as the strongest of the US domestic automakers after a near-death experience of their own, national governments rushing to prop up their own domestic auto industries, China becoming the largest auto market in the world, etc., etc.
Magna getting Opel certainly belongs in that category.
Nonetheless, it looks like its really going to happen. The next iteration of Opel will undoubtedly use a lot of Magna parts, but beside that, what will Opel’s lineup look like five years from new?
Well, probably not much different from what they look like now, but the priorities will be different. Those priorities may be much different ten years from now. It’s a new beginning for Opel under a new owner, and who can say what will happen with those different priorities in place?.
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