Opel “Vital” to GM’s Future in Europe

General Motors Co. says it will not sell its troubled Adam Opel unit, which it calls "vital" to the American company's future success in Europe.

"Opel is not for sale," declares GM Vice Chairman Steve Girsky in response to a report in Italy's Il Sole-24 Ore. The newspaper, which does not cite its sources, says Fiat is ready to buy Opel for a "symbolic" amount if GM's alliance with PSA Peugeot Citroen were to fall apart. Fiat tried unsuccessfully to buy Opel in 2009.

GM is betting its tie-up with PSA will reduce Opel's costs. The partners inked a deal in July to share logistics expenses. A joint purchasing pact is more than three months overdue. An agreement about shared product development also is behind schedule

Girsky says the partnership is "on track." The remaining accords will be completed by year-end, according to PSA.

In the meantime Girsky, who also is Opel chairman, has launched another restructuring of the perennially money-losing subsidiary despite calls by some analysts and investors to sell it. Girsky notes that the European unit is a "fully integrated" part of the company's worldwide operations. Opel takes the lead in developing some global small vehicles.

Separately, Opel's interim CEO Thomas Sedran tells Germany newspaper Tagesspiegel it would be a "strategic mistake" to leave the European market to its rivals.

Sedran says he believes Opel can achieve significant savings by designing some parts with PSA specifically to meet European regulations and conditions.

Opel currently uses components engineered to GM's global standards, according to Sedran. He notes that may include such costly items as safety equipment required only in the U.S. and starter motors that must function at extremely cold temperatures reached in Alaska and Canada.