Fiat withdraws from Opel discussions

Italian automaker Fiat withdrew from talks with the German government on the fate of Opel Friday, saying the plan posed extreme risks.

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 the interim financing, would expose Fiat to unnecessary and unwarranted risks, Fiat Chief Executive Officer Sergio Marchionne said in a statement.

Marchionne said a request to provide funds to an organization whose financial details and position remain unknown, was unreasonable, The Financial Times reported Friday.

The discussions over General Motors Corp.’s European operation were jolted when GM Thursday said cash reserves available to Opel fell $145 million short, the Times said.

Fiat has balked at putting up cash for the company, while the German government has balked at providing emergency assistance without guarantees that its money won’t be used to prop up GM’s ailing operations in the United States.

Canadian auto supplier Magna, which has also bid on Opel, said it would agree to add $422 million to its bid after GM announced the shortfall Thursday.