Fury on the streets as axe hovers over German workers

Tony Paterson in Berlin reports on the wildcat strikes that have greeted the deal's collapse

Thousands of Opel workers staged lightning strikes and angry protests across Germany yesterday after the sudden refusal by the car giant's American parent company, General Motors, to sell off its European operations.

The American decision took Germany completely by surprise. Chancellor Angela Merkel had assumed she had saved Opel through a €4.5bn (£4bn) deal guaranteeing 25,000 German car industry jobs with the sale of GM European plants to the Canadian car parts maker, Magna. But GM announced on Tuesday, wholly unexpectedly, that it had decided to keep and restructure its European operations, which involve 50,000 jobs including those at Opel in Germany and Vauxhall in Britain. GM has said it plans to axe some 10,000 jobs in Europe and many German Opel jobs could be affected.

"Our trust in General Motors is now zero, that's the heart of the problem," Klaus Franz, the head of Opel's workers' council, told some 10,000 applauding employees in Rüsselsheim, the car giant's headquarters, near Frankfurt yesterday. "We are back to square one."

There were other protests at Opel plants in the cities of Bochum, Eisenach and Kaiserslautern. GM has made no announcement about closure plans, but there were rumours that at least one German Opel plant would be shut down.

The news was described as a "stinging slap in the face for Merkel" by one German newspaper yesterday, as she had negotiated for months to reach a deal which she assumed would protect jobs. The agreement which also involved the Russian bank, Sberbank, was officially portrayed as sealed and helped her party win a convincing victory in Germany's September general election.

Der Spiegel magazine was equally critical of Ms Merkel. "The Chancellor now faces a heap of shattered remains," it commented in its online edition. "The deal that was assumed to be so secure has simply fallen apart. GM has shown Magna and the German government the door."

Politicians in Ms Merkel's new coalition of conservatives and liberals reacted with barely concealed fury. Rainer Brüderle, the new liberal Finance Minister, described GM's decision as "totally unacceptable." Jürgen Rüttgers, the conservative prime minister of the state of North-Rhine Westphalia, called it "the ugly face of turbo-capitalism".

Ms Merkel's new liberal Free Democrat coalition partners had criticised the Chancellor's €4.5bn offer of state aid to Opel in the run-up to the election as a waste of taxpayers' money.

However Ms Merkel's conservative politicians did their best to salvage what amounted to a political disaster. Roland Koch, the conservative prime minister of Hesse state, told workers in Russelsheim that the government would not allow GM to "maximise profits by taking German workers hostage".

The German government has pledged to start negotiations with GM in an attempt to save as many Opel jobs as possible and still held out the possibility of financial aid.