Germany wants better bids for GM's Opel unit

BERLIN -- Economy Minister Karl-Theodor zu Guttenberg told reporters Tuesday after meeting Fiat CEO Sergio Marchionne that the Italian carmaker had presented a serious offer but that rival bidders Magna and RHJ International remained in contention.

In an unexpected twist, China's Beijing Automotive Industry Corp. (BAIC) also submitted an offer, the Economy Ministry said, potentially making the competition a four-way battle. The government agency received the statement of interest Tuesday evening.

GM will have the final word on who buys Opel, but Berlin will play a crucial role because it is being asked to cough up billions of euros in loan guarantees.

Opel has 25,000 workers at four plants in Germany, and its fate has become a political hot potato here ahead of a federal election on Sept. 27.

Members of Chancellor Angela Merkel's Christian Democratic Union are reluctant to spend taxpayer money to save Opel, and some are pressing her to allow an "orderly insolvency" (bankruptcy reorganization) of the firm rather than back a deal.

Merkel will host a meeting Wednesday with the aim of settling on one or more preferred bidders. Senior German cabinet members, leaders from the states where Opel has plants, and top executives from GM and the bidders will attend.

Pressure is building ahead of a June 1 restructuring deadline for GM set by the U.S. government, which could lead to a Chapter 11 bankruptcy filing.

Fiat's Marchionne made an aggressive last-ditch push to address German concerns about his ambitious plan to fold Opel into a trans-Atlantic car empire that would also include U.S. carmaker Chrysler.

As Fiat lobbied the government, Magna and RHJ presented plans to labor officials. After those meetings, Opel labor leader Klaus Franz said he believed Magna was the top contender.

Guttenberg said insolvency remained an option if the bidders did not make credible commitments to preserve German jobs and show a willingness to assume greater financial risks.