The great Northern hope

General Motors agreed last week to sell its Opel division to Canada’s auto parts giant Magna.

General Motors agreed last week to sell its Opel division to Canada’s auto parts giant Magna.

When the deal concludes next month (barring any last minute hitches), it will end one of longest droughts in Canadian history.

No, not as long as the Toronto Maple Leaf drought, but still long by any other standard…

The last time an automaker was Canadian owned?

Well you have to go back to those lovely disco years, in the mid-1970s, when American Malcolm Bricklin set up shop in Saint John, N.B., with millions of the province’s dollars, to build his mid-engine sports car.

Numerous pseudo-Canadian car companies have dotted our landscape in the decades between 1930 and 1970. But if you’re looking for a totally Canadian car company with any substance and some name recognition, you have to go all the way back to McLaughlin, which was sold to GM in 1918.

That’s why this Magna deal is such big news. Great news even.

The basic deal looks like this: Magna and the Russian bank, Sherbank, equally split a 55 per cent of share of Opel (27.5 per cent each). GM retains a 35 percent share. The remaining 10 per cent is held by trade unions.

This “new” company can make and sell cars under the Opel name — except in the U.S. and China.

The German government will loan this group many millions of marks for restructuring. As such, it will be hard politically for the “new Opel” to rationalize operations in the EU.

The key to its success then, appears to lie in Russia, where low-cost production and a burgeoning middle class beckon. GM has already noted that Sherbank is just holding a place for Russian automaker GAZ, which needs a few months to get its act together to get in on this deal.

Is that a global deal or what?

But I think the most intriguing aspect of it, for Canadians at least, is that this new entity can make and sell cars under the Opel name in Canada starting in the third quarter of 2012.

It’s definitely a bummer that such cars couldn’t be sold in the U.S., a close and lucrative market if there ever was one.

But Magna chief Frank Stronach is a smart man. He came to Canada as young man with just $200 to his name, and built one of the largest manufacturing companies in the world. I’m guessing he’s got something figured out.

Once upon a time in Canada ...

• McLaughlin Motor Car: Easily the most storied Canadian automaker to date. Founded in 1987. Purchased by GM in 1918, to form the foundation of GM Canada.

• General Vehicle Corp: Sucked a lot of money from the province of New Brunswick between 1974 and 1975. But its Bricklin SV-1 was definitely unique, with gullwing doors, fibreglass body panels, and a mid-engine design.

• Les Automobiles Manic: The Manic GT is the most interesting Canadian car you never heard of… About 160 of the rear-engine coupes were built between 1970-71 at the firm's assembly plant in Granby, Que.

– Michael Goetz has been writing about cars and editing automotive publications for over 20 years. He lives in Toronto with his family and a neglected 1967 Jaguar E-type.

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