General Motors' board is weighing four options for its German-based Opel unit, including keeping the operation or letting it slide into bankruptcy protection, a person familiar with the options said Wednesday.
The 13-member board, meeting in Detroit on Wednesday, is also discussing whether it should accept bids from a consortium of Magna International . and Russia's Sberbank or a competing offer from RHJ International, a Brussels-based investment house, the person told the Associated Press.
A recommendation, which would have to be approved by the trust overseeing Opel, could come later tonight with a formal announcement Thursday.
Ruesselsheim-based Adam Opel, whose brands include Britain's Vauxhall, was transferred to a government-backed trust just ahead of parent GM's bankruptcy. The trust holds 65% of Opel, with GM holding 35%.
Presumably, GM could also wait to make a decision on the fate of Opel at a later date, though that seems increasingly unlikely.
GM for months has stated its preference for the RHJ bid because the Brussels-based private equity firm is more likely to restructure Opel while preventing GM's car designs and other technology from going to companies that compete against GM brands.
But German government officials have supported the Magna-Sberbank bid because they think it would preserve the most jobs in a critical election year. State-owned Sberbank has ties to Russian automaker GAZ, and GM is worried the Russian automaker could use Opel technology to compete with Chevrolet, which has grown in Russia.
If the board goes with RHJ or decides to keep Opel, it would set up a high-stakes confrontation with the German government, which has offered $6.5 billion in credit to support the Magna bid and wants to show it is preserving jobs in advance of the Sept. 27 election.
It also could set up a fight with Opel's powerful union, IG Metall. Opel employs 25,000 people in Germany, about half of GM Europe's total workforce. Up to six Opel plants could be closed in order to match factory capacity to sales, the person familiar with GM's options said.
A person close to Germany-based Opel Trust, who was not authorized to speak on the matter officially, said the trust would be involved with an announcement only if GM decides to sell the unit to one of the two investment bidders.
If GM decides to keep Opel, or if it does not come to a decision, or — least likely — GM decides to let Opel go into bankruptcy protection, then the announcement would have to come from the GM board, the person said.
The specter of such a decision drew derision in a newspaper interview from German Foreign Minister Frank-Walter Steinmeier, who is seeking to become chancellor in national elections Sept. 27.
"Magna's concept to take Opel over is the best offer," he was quoted as saying by the Mainzer Allgemeine Zeitung, reflecting the view widely held by the German government.
"I warn against lightly throwing around the word 'insolvency,"' he said, adding that German politicians had done everything possible and that "now it is time for General Motors' board to finally make a decision."
Meanwhile, German workers and labor groups waited anxiously. Rainer Einenkel, Opel's workers' council president at its Bochum plant, told the radio program Deutschlandradio Kultur that Opel's shaky situation threatened thousands of workers at Opel plants and at many parts manufacturers.
"We want the locations, the factories preserved," Einenkel said.