socialmedian: General Motors scraps plans to sell off Vauxhall

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General Motors scraps plans to sell off Vauxhall

Source: The Guardian

Nov 04, 2009

Summary

• Takeover by Magna had threatened more than 10,500 jobs
• GM says decision follows European business improvement

America's biggest motor manufacturer, General Motors, performed an abrupt U-turn last night by deciding to keep its European car manufacturing division, abandoning a proposed sale of Germany's Opel and Britain's Vauxhall brands at the eleventh hour.

Emboldened by encouraging global sales figures, GM's directors emerged from a meeting of the company's 13-strong board in Detroit to announce that an improvement in the European business environment had prompted them to change their minds about offloading the business, which employs 55,000 people, including 5,000 in Britain.

Instead of selling the operation to the Canadian car parts firm Magna, GM intends to spend €3bn (£2.7bn) on restructuring the division "in earnest" – a process still likely to involve government aid and that may yet lead to significant job cuts.

The surprise decision ended months of negotiations over the future of Opel and Vauxhall that have involved promises of aid by the German chance

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