Magna expecting profit from Opel by 2011

Article by Christian Andrei, on August 27, 2010

Magna, the Canadian parts manufacturer and prospective owner of Opel, says that the manufacturer will become a globally competitive brand by 2011 by which time it would have returned to profitability.

The Canadian firm is intent on replacing lots of Opel models with new cars and plans to take on markets in Russia. Opel's good management in combination with Magna will ensure a return to competitiveness, says Magna.

Although the Canadian company is implying that jobs in the UK could be under threat. Even though the four facilities of Opel in Germany could remain functional, under the leadership of Magna there are about 11,000 jobs all over Europe, with 2600 in Germany, has the possibility of vanishing.

When asked about Opel's factory in Luton, Magna spokesperson said that companies have to be profitable and those that are not are not good for society.

The German government gave consent last week to a deal for a Magna-led consortium to acquire majority share in Opel, Sberbank, a state-owned bank in Russia, will get a 35 percent stake, and the consortium retaining majority of the stakes.

35 percent will go to GM and the remaining 10 will go to the employees of Opel. The contribution of the Russian bank Magna has acquired a foothold in the market.

Although Russia will suffer for a while, Magna believes that they will recover quickly and that the Russians will have the money to purchase Opel products. [via autocar]

Topics: magna, opel, profit

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