Updated: Thu Nov. 05 2009 10:19:47 AM

The Canadian Press

RUESSELSHEIM, Germany — Thousands of Opel employees walked off their jobs to attend a rally at the automaker's headquarters Thursday, protesting General Motors Co.'s decision to abandon the unit's sale to new owners the workers hoped would preserve jobs.

The GM board's unexpected decision to call off the sale to Canadian auto parts maker Magna International Inc. (TSX:MG.A) and Russian lender Sberbank was a startling end to months of haggling in which Chancellor Angela Merkel and other German leaders had strongly backed the deal.

Now German workers worry GM will make even more cuts to return Opel to profit than Magna would have.

"Our trust (in GM) is now zero, and that is the heart of the problem," Klaus Franz, the head of Opel's employee council, told thousands of workers at Opel's German headquarters in Ruesselsheim, winning applause.

"We will stand together and fight for our future. We will not be defeated, we are proud, we are Opel," said Franz.

Franz called on GM to come up with a viable plan for the automaker. "We are starting over again from zero," he said.

He argued that Opel should have a more independent status and "no longer be an appendage of GM."

Unions and employees had offered cost-cutting concessions to ease a Magna deal, such as forgoing pay increases, that are now off the table.

GM will face a new battle to secure concessions for its own restructuring plan -- and has raised the prospect of a bankruptcy if it is blocked.

"Stop the talk about insolvency -- that is damaging to the business," Franz said.

Smaller rallies were being held at factories in Bochum and Kaiserslautern.

John Smith, GM's chief negotiator for the sale of Opel, said Wednesday that GM's plan was similar but not identical to that presented by Magna and Sberbank, which had called for the elimination of 10,500 European jobs or about 20 per cent of the work force.

Smith did not elaborate on possible job losses.