MAGNA’S PLANS to take a majority stake in GM’s loss-making European arm Opel triggered a backlash yesterday when German carmakers Volkswagen and BMW voiced unease over the deal and warned that they would review links with the Canadian car parts supplier.
VW chairman Ferdinand Piëch said Europe’s largest carmaker would consider shifting business to other car parts makers after GM decided last week to sell a 55 per cent stake in Opel to Magna and Russia’s Sberbank.
“We could easily find other suppliers,” Mr Piëch said on the sidelines of the Frankfurt motor show. “We as a group do not like it when our suppliers become our rivals,” the grandson of Ferdinand Porsche said.
BMW’s chief financial officer Friedrich Eichine voiced similar concerns. “Magna has always been a strong supplier for us, but Magna will now become a competitor. This is a new situation which we will have to assess. We will not put into question any running contracts with Magna, but where we see conflicts of interests we might in the future decide against Magna.”
The Spanish government also objected to the deal, which will rely on €4.5 billion in loans and credit guarantees, mainly from the German government. “The more we know about the Magna option, the less we like it,” said industry minister Miguel Sebastian.
Magna assembles engines and builds a large variety of components such as body panels, roofs, mirrors and door handles.
The Canadian group also assembles cars as a contract manufacturer for brands such as BMW, Daimler, Saab and Porsche.
Magna has been trying to assure customers that Opel would be completely separated from the car parts business. The group’s executives will meet customers in Europe and Asia during the next few weeks to try to allay concerns.
Also at the Frankfurt show, Renault chief executive Carlos Ghosn cemented his position as the car industry’s boldest promoter of electric cars by committing the French manufacturer to producing four new battery-powered models within three years and to reaching six-figure sales for one of them by the middle of the next decade.
Mr Ghosn said Renault planned to produce an all-electric compact van, a family car and a city car by 2011, and a five-seater by 2012. – Copyright The Financial Times Limited 2009
