After setting off an outcry in Germany, Italian carmaker Fiat sparred with a European Union official over its feelers to acquire General Motors’ Opel and Vauxhall brands in Europe at a time when the whole industry is reeling from the economic recession. German trade unions and Opel retailers declared Fiat unfit to take control of the GM marques, and Guenter Verheugen, a German who is the European Union’s commissioner for industry policy, scoffed at the plan. Fiat is also in talks to take control of US carmaker Chrysler. “I wonder where this heavily indebted enterprise is going to get the funds to tackle two such operations at the same time,” said Verheugen in a Bavarian Broadcasting interview. He added that Fiat was a direct rival to Opel and “not exactly the European carmaker that is doing the best.” Fiat hit back in a statement from its Turin headquarters. Fiat Chief Executive Sergio Marchionne said, “I’m astonished at the substance and the tone of these remarks,” adding that Verheugen was “again saying things that were not constructive for the car industry.” Verheugen has stood up for the industry in Germany, however. Marchionnne added that he had always supposed an EU commissioner should stand above his own national origins, and called for a “constructive dialogue” with European carmakers “instead of death sentences that one-sidedly select who is going to survive.” In Rome, Italian Foreign Minister Franco Frattini, who, as a former European Commission was a colleague of Verheugen’s, entered the fray, accusing him of “unacceptable interference” in the issue, particularly since one of the companies involved had the same citizenship as Verheugen, who is vice-president of the EU Commission. Fiat is one of several companies reportedly eyeing GM Europe, though US news reports said this appeared to be Fiat’s plan B if no deal could be reached to acquire US carmaker Chrysler by the end of this month.
Opel retailers in Germany joined in the assault on Fiat. Their national leader, Thomas Bieling, said, “We are expecting Opel to get a strong partner. That is what Fiat is not.” He also assailed Fiat for its treatment of its own franchised retailers in Germany, saying this was not the civilised dialogue that was customary at Opel, and Fiat dealers usually had to resort to litigation to obtain their rights from the Italian carmaker. The German government was non-committal about the many-sided negotiations with GM, saying only that it was insisting that the lead investor in GM Europe offer a sustainable plan and retain Opel’s German factories and workforce. It said a senior Berlin official, Jochen Homann, a state secretary in the Economics Ministry, was in Washington for talks on Opel.
IG Metall, the main union at the Opel factories, said it was firmly opposed to Fiat becoming the new proprietor, whereas it would welcome Magna, a maker of auto components, as an investor in Opel. The top IG Metall official dealing with the crisis, Armin Schild, said there were other potential investors. But he told ZDF television news he must remain discreet and could not identify them. The labour groups’ criticism of Fiat has focused on the fact that both Opel and Fiat sell low-priced cars. Unionists believe the Italian company would be bound to scrap meagre-selling Opel models which were in direct competition to its own Fiat models.