Rexrodt tries to ease VW dispute

THE German Economics Minister, Gunter Rexrodt, yesterday held talks with Opel, General Motors' German subsidiary, and announced that he would also meet senior Volkswagen managers within the next few days. Mr Rexrodt had offered himself as a mediator in the spiralling dispute between the two car manufacturing giants over alleged industrial espionage.

Mr Rexrodt's intervention is the latest attempt to calm the bitter war of words, which German government leaders fear will damage the image of German car manufacturing as a whole.

Der Spiegel magazine, which first published the allegations against Jose Ignacio Lopez - former purchasing director at General Motors, and now number two at VW - this week printed details of how confidential Opel data was alleged to have been secretly entered into the VW computer system. Ferdinand Piech, the VW boss, insists that 'no secret materials could have undergone such a process'.

However, as the evidence against Mr Lopez has appeared to mount, there has been speculation that Mr Piech himself must have been aware of what was happening. Meanwhile, in an attempt to bring some order back to the Volkswagen house, Klaus Liesen, the chairman of VW's supervisory board, is to move into an office at VW's headquarters in Wolfsburg.

There is at least one small sign of hope for VW. After heavy losses early this year, it announced this week that it showed a profit for July of DM70m.