General Motors announced yesterday that it will invest 1.9 billion euros ($2.57 billion USD) towards the restructuring of Opel/Vauxhall, more than tripling its previous pledge of 600 million euros.
“GM”s €1.9 billion commitment is the right course of action for Opel/Vauxhall and should clearly signal our determination to fix our business,” said Nick Reilly. “Our call for the additional funding was approved by GM”s senior management and supported by the GM Board of Directors. Meanwhile, we have shared this decision with the European Commission as well as the national and state governments involved. We hope that our strong commitment will be well received as a major milestone in our ongoing discussions about government guarantees to cover the remaining gap.”
The increased investment from GM means Opel will be able to keep its doors open through the year. It previously said it had enough liquidity to operate in to the second quarter. The move could also help Opel’s restructuring win state aid from European governments.
Under its viability plan, Opel/Vauxhall had estimated funding requirements of €3.3 billion. However, an additional €415 million had been requested by the respective European governments to offset the potential impact of adverse market developments.
– By: Stephen Calogera