The sale of General Motors’ European assets to Magna and Sberbank was a rotten deal and its demise should be celebrated by anyone who believes in fair competition.

It was a deal that stank of political interference, having been concocted by German politicians who were, at the time, in the midst of a general election campaign.

Despite three bids being on the table, Angela Merkel, the German Chancellor, had eyes only for Magna. She made €4.5 billion available to the Canadian-Russian consortium, in return for a guarantee that German Opel factories would not close.

The other bids from Fiat and RHJ International, a private equity firm, recognised that part of GM Europe’s problem was overcapacity and they refused to give the Germans a jobs guarantee.

Under the Magna deal, Germany’s Opel operations would have been protected, so the new owner would have had to find cost savings from Opel and Vauxhall operations elsewhere in Europe.

Unsurprisingly, the British, Spanish and Belgians were not happy about Germany trampling over European competition rules in this way and they complained.

The European Commission gave the Germans a slight rap on the knuckles, but, in the end, it has been GM in the United States that has scuppered the deal.

While this throws the future of Opel and Vauxhall into uncertainty again, British workers can only benefit from decisions on their future being made on a level playing field.

A level playing field should certainly play into the hands of Ellsemere Port, the Merseyside factory that is building the Vauxhall Astra, as it is regarded as one of Europe’s most advanced car facilities.

The future of Vauxhall’s Luton factory is less optimistic — but then it was under the Magna deal, as well.

The other part of the Magna deal that raised concerns was the involvement of the Russians. Sberbank, the state-owned bank, would have owned 35 per cent of GM Europe (more than Magna, a Canadian car parts maker) and it was planning to share Opel technology with Gaz, the Russian carmaker owned by Oleg Deripaska.

GM in America was miffed that technology it had invested millions of euros in developing could find its way into a competitor’s hands.

So now that GM has pulled the plug on Magna and Sberbank, what happens? Does it continue with efforts to seek a partner, or does it go it alone and hope that retail markets recover?

Either way, the Germans have set an expensive precedent and whoever ends up owning GM Europe will be entitled to ask Mrs Merkel for the billions of euros she was willing to give Magna.

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