GM has retracted its request for aid in Europe. The company now says it can fund its restructuring efforts for its European unit Opel on its own.
Last week the German government refused to provide Opel with a €1 billion ($1.23 billion) aid package, saying GM was now capable of financing the restructuring itself. GM made a quick trip into and out of bankruptcy in 2009 and its North American operations returned to profit in the first quarter of this year. Due to government bailouts prior to bankruptcy that were provided by the Treasury Department of the United States, GM is now 60 percent owned by the U.S. federal government.
Requests had also been made to the British and Spanish governments to fund restructuring operations in those countries. GM has already gotten a pledge of €300 million ($370 million) in aid in Spain.
At the time of GM's troubles, it was highly expected that GM would sell Opel. But GM decided to keep its European unit, which, although not yet returned to profit, is an asset to the company. Opel has been a resurgent brand in Europe in recent years and the German automaker provides much needed technology for GM's global platforms.
GM had already come up with €1.9 billion ($2.3 billion) to restructure its European unit and will now have to find another €1.4 billion ($1.7 billion) to carry out its plan, according to Nick Reilly, president of GM Europe.
