The General Motors' board is starting its two-day meeting today, and it is believed that the company is going to decide what will happen to the German Opel automobile unit. There are other topics to be discussed, including a new marketing campaign and preparation for a public offering of stock so the automaker can repay the U.S. taxpayers. Nevertheless, the major news will be the company's decision about Opel -- what should General Motors do? Is it smart for the company to give up a portion of its market share in Europe in order to stabilize American sales? Reuters examined several scenarios General Motors might face.
The foreign automaker continues to up its bid for Opel, adding 25 million euros to the bid it first made on July 20. This plan should require less taxpayer money, making it a bit easier to swallow the deal for the American taxpayer. The problem is that the German government has not backed this bid. Of course, the company could wait until the German elections take place to see if the German political climate favors such a move.
What should the company do with Opel? Sitting here in my chair of judgment, it seems the most plausible and responsible move would be to wait to see if RHJ is willing to pay more money. That way, the U.S. automaker can take some of the money an try to bolster its American sales.
Remember, another topic that is supposed to be discussed at the meeting is a new advertising campaign for the company. General Motors needs money, and selling Opel is one way that it can make some cash.
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