GM's Opel division will be helping GAZ
September 18, 2009
by Tom Krishner, AP Auto Writer
DETROIT (AP) - Last week's deal for General Motors to give up control of its money-losing Opel unit has a big downside: If the deal goes through, Russian automaker GAZ will get its hands on GM technology.
Worse yet, GAZ, with cars that are light years behind most global automakers in quality as well as engines, transmissions and other technology, is likely to use what it gets from GM to compete against the Detroit automaker's Chevrolet brand in Russia.
"Each deal has a flip side. I think that is the risk that is currently being assessed by GM, and maybe they're willing to accept it," said Mikhail Pak, auto industry analyst with the Aton Investment Co. in Moscow.
GM said Sept. 10 that it had agreed to cede a 65 percent stake in the German-based Opel to Canadian auto parts supplier Magna International Inc. and Russia's state-owned Sberbank. GM keeps 35 percent and Opel's workers get 10 percent. Under the deal, expected to close by Nov. 30, the German government also pledged $6.5 billion in credit.