Main focus of Tuesday, June 2, 2009

General Motors declares bankruptcy

US carmaker General Motors declared itself bankrupt in New York on Monday. A massive restructuring plan using state loans will leave the government in Washington holding a 60 percent stake in the company. The Canadian-Austrian supplier Magna will take over GM subsidiary Opel, with Germany granting it a temporary loan of 1.5 billion euros.

Les Echos - France

After the bankruptcy of US car manufacturer General Motors and the rescue of Opel in Europe, the business paper Les Echos reflects on the future of the battered car industry: "The automobile industry is going through a historic late spring of 2009. The bankruptcy of General Motors, Fiat's takeover of Chrysler, Magna's Opel purchase and the musical chairs in the PSA Peugeot Citroën management. Never has this fascinating and extremely competitive sector gone through so many profound upheavals in such a short space of time. Car history is being written before our eyes. The 20th century of the car closed with the insolent success of the Japanese carmakers and the decline of the 'big three' American companies. The 21st century, which is only just starting today in an unprecedented context of crisis, is still far from having delivered its verdict: who will be tomorrow's big winners - and big losers?" (02/06/2009)

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De Volkskrant - Netherlands

The Opel rescue operation is aimed at preventing social misery and industrial decline, but when a company receives money from the state there must be consequences, writes the daily De Volkskrant: "It is bitter to see billions flowing into companies that made a mess of things. GM - including Opel - failed to recognise the zeitgeist and ignored the efforts of their rivals to produce cleaner and more fuel-efficient models, in particular Toyota with its Prius. Nonetheless they are being salvaged at a high price. The social arguments weigh heavily and justify the rescue operation. But governments must now use their expensive investments to persuade the carmakers to take a different, more green direction. Above all GM and Opel must be encouraged to invest in the production of electric cars. The billions in taxpayers money must in this case at least be made to serve a broader social purpose - and not just ensure the survival of this old-timer." (02/06/2009)

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Mladá fronta Dnes - Czech Republic

The liberal daily Mladá Fronta Dnes writes that after the financial crisis General Motors will change just as radically as the rest of the world: "America will not be the only country to remember this crash for many years to come. The car legend is running out of breath. ... But the bankrupt carmaker has had problems for a long time. It couldn't cope with the changing times. It went on making big, powerful cars in the tradition of Buick, Cadillac and Chevrolet. They set the standard and were the dream of every family. However all that changed with the rising energy prices. The real break came last year when oil prices doubled in the US. For the first time the Detroit flagships General Motors, Ford and Chrysler sold fewer cars than the smaller Asian models. ... The bankruptcy proceedings are now the way to transform this dinosaur into a debt-free tiger. US President Barack Obama can only hope he gets back as many of the billions the government put into the rescue as possible." (02/06/2009)

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Frankfurter Allgemeine Zeitung - Germany

Commenting on the Opel rescue the conservative Frankfurter Allgemeine Zeitung writes: "The 'Operation Opel' has so many players with the most diverging interests that one can already imagine the dimensions of the doctoral theses that will one day be written on this subject: a president in the US and numerous heads of government in Europe, commissioners in Brussels and German premiers, a grand coalition whose key figures belong to three different parties, a disappointed Italian bidder and a Canadian-Austrian-Russian bidder that can't believe its luck at winning the deal on such favourable terms. … But what (most) German parties never lost sight of even for a moment were the elections, both in the immediate and in the near future … . The final statement won't come until later anyway. So who really has a future? General Motors, which is going bankrupt at the state's behest, or Opel, which has been put on the state drip for now and in future will perhaps be taking orders from Washington (instead of Detroit) and Moscow?" (02/06/2009)

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Il Sole 24 Ore - Italy

Writing on the bankruptcy at General Motors and the rescue of GM subsidiary Opel the business paper Il Sole 24 Ore comments: "[US President Barack] Obama is counting on the great GM … creating new jobs as it collapses. Germany is doing the opposite: but here the elections are this September rather than in 2012. So goodbye to all the dreams of glory. Better to join hands with the Kremlin and a company that will never be competitive and never create jobs than suffer a defeat at the ballot. … [German Chancellor Angela] Merkl is putting her money on the usual Germany, … convinced that sooner or later things will go back to normal and the worst will never happen. Obama may lose but he's counting on a new historical trend, and in the end the US will make it work to its advantage. Merkel may use Opel to get a good result in the elections but she's relying on an rusty old trend, and Germany will pay the price for this. We'll soon see whether Europe, too, will pay that price, and how high it will be." (02/06/2009)

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