Nov. 6 (Bloomberg) -- General Motors Co. said Carl-Peter Forster will leave as head of the automaker’s European operations and advise in the transition to his replacement.

GM said it will start an “immediate external search for a new CEO for Opel Europe.” Chief Executive Officer Fritz Henderson said in a statement that no other management changes at Opel “are being considered at this time.”

Vice Chairman Bob Lutz will be interim chairman of the supervisory board, said one person familiar with the situation, and international operations chief Nick Reilly will lead Opel and British sister brand Vauxhall on an interim basis, said two people, who asked not to be identified because decisions haven’t been announced.

GM’s board agreed on Nov. 3 to retain full ownership of Opel and Vauxhall rather than proceeding with the sale of a 55 percent stake to Aurora, Ontario-based Magna International Inc. and Russian partner OAO Sberbank. The reversal angered Opel’s unions as well as German politicians, who had lobbied for a transaction with Magna and pledged 4.5 billion euros ($6.7 billion) in government aid.

GM is seeking a German executive to replace Forster, one of the people said.

“There is a view in Germany that the problem with Opel is incompetent American management,” said Dennis DesRosiers, president of DesRosiers Automotive Consultants Inc. in Richmond Hill, Ontario. “To dispel that, GM had better put a German in charge who has the confidence of the German government and the people.”

Plan Next Week

Opel improved under Forster, Henderson said in the statement.

“We expect to finalize our proposals for establishing Opel/Vauxhall’s future next week and will be engaging all stakeholders to see how we can best work together,” he said in the statement. “We will update on our progress as soon as is possible.”

Forster said several hours before Detroit-based GM shifted strategy on Opel that Magna’s proposal was “the best solution” for the unit and would open “very interesting possibilities” in Russia’s automotive market.

“It would be hard to continue with Forster, after he supported the sale to Magna,” said Stefan Bratzel, director of the Center for Automotive Research Institute at the University of Applied Sciences in Bergisch Gladbach, Germany. A management change is a “burden” at a time when GM needs to “build trust,” he added.

“It’s been an honor to be part of the history of Opel,” Forster said in the statement.

German Debt

Henderson told reporters yesterday that the carmaker didn’t draw on all of a 1.5 billion-euro bridge loan that Germany provided Opel at mid-year and that the remaining 900 million euro debt will be repaid by Nov. 30.

The automaker can help fund Opel in the interim with money borrowed from the U.S. or by forgiving royalty payments from the German unit to the parent company, Henderson told reporters. Terms of the $50 billion in U.S. aid do not prevent GM from spending money outside of the home market, he said.

“We certainly need to be prudent about it, be very careful about it, but we do have the ability to run a global business,” Henderson said yesterday.

German Chancellor Angela Merkel’s government chose Magna as preferred bidder for Opel in May. Merkel and her chief of staff, Ronald Pofalla, agreed at a meeting yesterday with Klaus Franz, Opel’s top labor representative, that GM must focus on securing jobs and building on the division’s technology as part of its new plans for the unit, according to a government statement.

“There’s a high probability that the new restructuring under Nick Reilly will bring the Opel brand into a downward spiral,” said Ferdinand Dudenhoeffer, director of the Center for Automotive Research at the University of Duisburg-Essen. “Saving for GM means spending less money on development and bringing U.S., Korean and Chinese cars to Europe.”

‘Smart Move’

Reilly, who is based in Shanghai, is in Germany today and Henderson will be there next week to work on Opel’s restructuring, one of the people familiar with the plans said.

Forster, 55, became head of Opel in 2001 after overseeing model development at Munich-based Bayerische Motoren Werke AG. He succeeded Henderson as president of GM Europe in 2004. Forster is credited with improving Opel’s product lineup with the Insignia mid-sized sedan, which won the 2009 European Car of the Year award.

Appointing another German to run Opel would be “a very smart move for GM,” DesRosiers said. “They have to play to the European community that thinks an American can’t run a European company.”

To contact the reporter on this story: Jeff Green in Southfield, Michigan, at jgreen16@bloomberg.net; Chris Reiter in Berlin at creiter2@bloomberg.net.

Last Updated: November 6, 2009 17:22 EST