GM has paid back Opel loans to Germany: Merkel

BERLIN: General Motors has repaid the 1.5 billion euros (2.2billion dollars) in bridging loans it received from Germany to keep its troubled European unit Opel afloat, Chancellor Angela Merkel said on Tuesday.

"I can tell you that the last funds (received by) General Motors have been paid back, which means that the Opel operation has not cost the German taxpayer a cent," Merkel said in a speech in Berlin.

She added that she expected "a comprehensive thank-you letter from General Motors in a few years."

And she defended her decision to offer the huge loan to the US firm, saying: "It was absolutely right ... to build a bridge."

GM agreed in September to sell a majority stake in Opel, which includes Vauxhall in Britain, to Canadian auto parts maker Magna and Russian state-owned lender Sberbank.

But it has since decided that it wants to keep the loss-making unit and restructure itself, with the loss of around 10,000 jobs across Europe. It has not yet said where the jobs will be cut and which plants will be closed.

The news infuriated Germany and Merkel, who had invested a lot of political capital in the deal with Magna-Sberbank.

Earlier Tuesday, GM Europe head Nick Reilly said the firm expected to keep open its plant in Bochum in western Germany.

The plant, employing almost 5,200 people near Essen will remain "an important location in the future," Reilly said after talks with the premier of the German state of North Rhine-Westphalia where the site is located.

Astra and Zafira cars are assembled at the plant, which also makes axles and gearboxes, according to Opel's website.

It is one of four Opel plants in Germany, employing between them around 25,000 people, half the European total.