GM gets cold shoulder in Germany

Stephen Beard Nov 12, 2009
HTML EMBED:
COPY

GM gets cold shoulder in Germany

Stephen Beard Nov 12, 2009
HTML EMBED:
COPY

TEXT OF STORY

Stacey Vanek-Smith: Executives from General Motors have been in Germany this week, seeking state aid for the company’s struggling European division. But, as Stephen Beard reports, they’re getting the cold shoulder instead.


Stephen Beard: Germany had offered $6 billion of aid if GM sold its European Division to the Canadian parts-maker Magna. Magna had promised to protect German jobs. But that deal is off. GM is keeping the company. And so, says the German government,the $6 billion is off the table too.

GM is not getting any cash from the German taxpayer. But, says David Bailey of the Coventry Business School, GM can look elsewhere.

DAVID BAILEY: The danger here is that GM touts its business around European capitals saying: “Give us a subsidy and we’ll keep production in your country.” And engages in a divide-and-rule tactic.

He says half of GM’s 50,000 European jobs are in Germany. The German government may have little choice but to cough up in the end.

In London this is Stephen Beard for Marketplace.

As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.

Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.

Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.