Fiat likely to buy GM’s European business
German state minister, Hendrik Hering’s claims that Fiat is likely to bid for the US car giant’s business in Europe, were downplayed by GM’s close sources.
However the rumour, confirmed by the minister, put Fiat alongside the Canadian automotive parts group, Magna International, as the foremost bidders for GM’s business which includes Vauxhall in the UK and Opel in Germany.
Although GM and Fiat did not offer any comment, this speculation is being taken “with pinch of salt” in the industry.
Fiat reported €360 million (£322 million) pre-tax loss and debt of €6.6 billion. The company is negotiating tie-up with Chrysler. Final terms of the deal are likely to be worked out by next Thursday, when the US government might approve a restructuring plan or compel Chrysler into bankruptcy.
Speaking at Fiat’s results conference, its chief executive, Sergio Marchionne, declared that company was committed to the US government’s plan and was open to get this transaction done.
GM is keen in selling off its European operations in order to save its core US business.
Although discussions are focussed on Germany, where three of the subsidiaries run their manufacturing operations, Vauxhall UK contributes 25% of GM Europe’s business.
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