Opel’s new parent firm, PSA Group, has expressed interest in selling Opel vehicles outside of Europe. So where to expand to first if not China — the world’s biggest car market? Not so fast, according to Opel CEO Karl-Thomas Neumann, who recently shared skepticism on introducing Opel in China to reach profitability.
“The Chinese market is no longer the cure-all to help solve the problems on all the other markets,” Neumann told German publication Auto Motor und Sport. The executive added that instead of allocating resources to introduce Opel in Asian markets, his first priority is to make the carmaker profitable in Europe by leveraging the relationship with the PSA Group.
Under General Motors, Opel has not turned a profit in Europe for 16 years.
Early in the decade (and under GM ownership), Opel ventured into China by importing vehicles into the country, which subjected it to China’s high import tariffs. After selling less than 6,000 vehicles over the course of a year, GM phased out Opel in 2014 so as not to interfere with its Buick brand, which is highly successful in the Chinese market. Ironically, Buick sells some Opel vehicles as part of its own lineup in China, albeit under the Buick badge.
Earlier this month, General Motors announced that it has reached an agreement to sell Opel, along with its sister brand Vauxhall, to French automaker PSA Group for €2.2 billion ($2.3 billion USD), raising questions about Neumann’s future at the automaker. Shortly after, it was confirmed that Neumann will stay in his spot under PSA ownership.
“It is our intention to make sure Mr. Neumann continues the excellent work he has been doing”, stated PSA Group chief executive officer Carlos Tavares, Neumann’s new boss, at a press conference announcing the deal. “We trust that he will be in the best position to lead the turnaround and a profitable future for Opel.”
PSA has promised to operate Opel as a separate firm with distinct management while exploring opportunities to sell Opel cars beyond Europe.