(Source: Times Online, UK)

Fiat has pulled out of talks with the German Government about Opel, blaming “unreasonable” funding demands, but emphasised that it was not withdrawing its bid for General Motors’ European unit, which owns Opel and Vauxhall.

Sergio Marchionne, Fiat’s chief executive, said that Germany had asked his car group to provide emergency funds for Opel, which would expose it to “extravagant risks”.

Mr Marchionne said “The last round of requests which would require Fiat, among other things, to fund Opel on an emergency basis while the German Government determines the exact timing and conditions of interim financing, would expose Fiat to unnecessary and unwarranted risks.”

Mr Marchionne said that he had not been granted full access to Opel’s financial records and so it was unreasonable to ask Fiat to provide emergency funds. Because today’s meeting will focus specifically on Opel, Fiat would not be attending, he said. However, he said that Fiat remained interested in a potential deal with GM.

“We remain committed to finding ways to bridge the expectations of both General Motors and the German Government, but the emergency nature of the situation cannot put Fiat in a position to take extravagant risks,” he said.

Gareth Thomas, the Trade Minister, will attend the emergency talks in Brussels today. A Commission spokeswoman said: “The aim of the meeting is to exchange information and ensure a level playing field for co-ordination.”