Frankfurt -- General Motors has brought the sale of its European car division Opel/Vauxhall to a screeching halt, fuelling fear and anger in Germany Wednesday as the US group reset its global auto strategy.

Some German auto analysts felt the decision was logical from an industrial viewpoint but politicians and unions were furious.

Economy Minister Rainer Bruederle slammed GM's ditching of a deal with the Canadian auto parts group Magna and Russian Sberbank as "totally unacceptable."

British authorities said however that they would work with the US auto giant to secure the future of British plants that make Opel's sister brand Vauxhall.

GM, which was struggling with bankruptcy, had initially agreed to sell a 55-percent stake in Opel/Vauxhall to Magna and Sberbank.

GM Europe employs about 55,000 workers in Germany, Britain, Spain, Belgium, Poland and Austria.

But now, the GM board "has decided to retain Opel and will initiate a restructuring of its European operations in earnest," a statement said.

GM explained the abrupt U-turn by underscoring "an improving business environment for GM over the past few months, and the importance of Opel/Vauxhall to GM's global strategy."

To survive, the US group must compete successfully in a turbulent global market focused on developing small, fuel-efficient cars.

Europe leads the United States in this field, and GM needs Opel's expertise, Metzler Bank analyst Juergen Pieper told AFP.

"The strategic importance of Opel is enormous," he said.

US rival Chrysler made the same choice when it agreed to a takeover by Italy's Fiat.

Analysts expect the economic crisis to foster highly selective alliances to share technology for electric cars and the geographical reach of distribution networks.

The Magna deal had raised questions about the strategy of Sberbank, which is state owned, and possible plant closures in Europe.

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