City A.M. Reporter
General Motors (GM) will probably stick to a plan to cut costs at Opel by 30 percent after deciding to restructure the European subsidiary itself rather than sell it, Bob Lutz, a GM executive set to become Opel’s chairman, said yesterday.<br /><br />“The restructuring plan developed at the end of last year is still the basis for a profitable business model. The plan foresees a 30 per cent cut in structural costs,” Lutz told the Swiss Sonntag newspaper. “We will now analyse the current situation carefully and propose relevant measures. We don’t expect any fundamental differences to the models discusssed so far.”<br /><br />GM left leaders in Berlin and Moscow seething last week when it dropped plans to sell a 55 per cent stake in Opel to Magna and its Russian partner Sberbank. <br /><br />GM will instead restructure Opel itself in a €3bn revamp it wants countries with Opel plants to help finance. The goal is to cut fixed costs at Opel by 30 per cent -- in part by chopping a fifth of Opel’s 50,000 staff. <br /><br />Lutz said the main reason GM had decided not to sell a stake in Opel was because GM’s business position had improved and there were also brighter signs in the European economic climate.<br /><br />“We are all rather optimistic at the moment and see small signs of a mild recovery. There could be a slight recovery towards the end of the year, which would hopefully continue in 2010 and 2011,” he said.