General Motors Europe, and subsequently Opel/Vauxhall, is still bleeding money. But not nearly as alarming a rate as last year. By comparison, GM’s European operations lost $394 million in the second quarter of 2012, more than three times the amount of the $110 million lost in the same time frame this year.
The company expects to at least break even in Europe by 2015, and from the progress that appears to be made, GM and Opel may stay true to their word.
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Of course they will break even by 2015, may even be 6 months or so before. Vauxhall & Opel have always had a strong, excellent & competitive range and their currant ranges are extremely competitive. I have every confidence the losses will be turned around into high profits.
The thing that will save Opel long term is that they go upscale.
The most profitable cars on the market are mid to upper market cars. They are like trucks and not as expensive or more expensive to make but the higher transaction price makes them more profitable even in lower volumes.
This is how Opel will thrive in the future.
Now Chevy is the one that will have to fight for profits with each and ever car in the Euro market. It is tough to make money Volume in near any market anymore and Europe with sluggish sales it is even more difficult.
A move upscale is not without huge risk. Opel will loose much of its traditional base. Also, Euro upscale in the form of VW is rather different than how Americans view upscale.
Opel is a problem for GM in that cars like the Astra OPC make it difficult for Chevy to compete with Ford on a global level.
Honda benchmarked the next Civic on Focus and Astra–two cars pimped in Europe as premium but, in the case of Ford, value/mainstream in the States.
GM is in a tough position regarding Opel and Chevy and one can only hope that Europeans stop equating Opel with Skoda. While I support GM holding onto Opel, I do now understand why the taskforce wanted to dump the misfit brand.
Steve Marcus writes: “Opel is a problem for GM in that cars like the Astra OPC make it difficult for Chevy to compete with Ford on a global level.”
Can you please elaborate? Isn’t it just the opposite, that cars like the Astra OPC are the more effective competitor to the Ford Focus than anything from the Chevrolet Cruze line?
The problem lies in GM wasting, for lack of any better word, a great car like Astra OPC on a regional brand while falling further behind in NA and other markets with Cruze vs Focus.
GM has made a great turn around but still needs to fortify Chevy.
Making chevy great would help if GM slapped a bowtie on Astra and sold it in the us europe asian Australian markets!
If they won’t but it with a bowtie on it then it’s not a very good car to start off with!
Vauxhall opel and holden acts like GM works for them when they should be working for GM supporting chevy buick Cadillac cuz GM owns them!
You don’t tell your boss what to do! That’s his or hers job!
I’ve often thought that GM should shift some Opel’s unfit for Buick over to Chevy outside of Europe.
This has been done for years outside N A but this practice has recently been abandoned. As an example, Zafira van being replaced by Spin in Brazil.
I wish GM would sell non luxury Opels as Chevy on a global level outside of Europe where they could offer a reduced Chevy range made up of cars like Beat and Grove.
Design language might not be a perfect fit but this has not stopped SS. Also, Chevy lacks a solid design language and has for some time.
The goal should be to globalize as many GM cars as possible. There is nothing wrong with tagging low end price point cars as Opel in Europe and Chevy elsewhere. This is already happening with highet end Opel’s as Buick.
Certainly GM could cut R&D while increasing scale under such a plan.
GM do Brasil has developed the Chevrolet Spin as a replacement not for the Zafira, but as replacement for the Meriva A, which, by the way, had been developed mainly by GM do Brasil, not Opel. And the Spin is intended mainly for Third World countries, as a competitor to Toyota’s Avanza. Sure, in its 7-seater configuration, the Spin also replaces the Zafira. Similar to the Toyota Avanza which has two rumble seats in the back. (Has the Zafira ever been sold in Brasil? I don’t know, but don’t believe it).
I don’t see any Opel cars which would not be suited also as Buicks. But sure, not every Opel car is suited for each and every market on this planet. The Meriva B is not really a car for Third World countries, where the Spin is better placed.
One might like it or not, GM is no longer the federation of more or less independent national companies which exchange their developments by criss-crossing badge-engineering, with GM being just one brand per country, but by a different name everywhere.
Today they have declared Chevrolet and Cadillac as the two global core brands, and all the others as “carefully cultivated” regional brands, which are now being collected as a “hybrid global brand”, with badge engineering between Opel, Buick, Vauxhall, and I believe, in future also Holden. But also then not every car is suited for each and every market indiscrimately.
Can you imagine a Holden Commodore “Ute” pickup with its open, unprotected cargo space running at 250 km/h on a German Autobahn? It would be utter nonsense, in my not so humble view, to offer such a car in Germany.
The Astra is already sold outside of Opel markets as Buick Verano (North America) or as Buick Excelle XT (Hatchback) and GT (sedan) in China. Not as Chevrolet.
GM corporate management has decided to push Chevrolet and Cadillac as global brands, and to marry Opel/Vauxhall and Buick as “hybrid global brand” with a common design language and engineering centered at the Rüsselsheim ITEZ, i.e. in Germany. I interpret the latest changes in Australia as the beginning of Holden’s integration in that “hybrid global brand”.
As to the “bleeding money” I would take the GM official numbers with a grain of salt, in view of the supposed absolute lack of profits in Europe of other very profitable US companies like Google, Apple, Amazon, Starbucks, which move their intake from European sales away to tax havens where there hardly pay taxes. This is OK for the US government.
GM can charge Opel a lot of things — management fees, licences being the most prominent ones, which can be quite arbitrariy priced.
So true..OPEL only looses money on paper. GM makes a fortune of Opel cars badged as Buick globally not to mention Opel platforms for Chevy and its local Chinese marques.
If that image is a new Opel sportscar, they should sell it in the U.S. and compete against all the other imports!
I still say can opel vauxhall and replace those models with new redesigned chevys buicks and Cadillac s! Same goes for down under!
If GM is going to lose money in a region then I would rather see it with the real GM s big 3!
If the locals don’t like it they can pound sand! I mean it’s not like these opels and vauxhalls are flying off the lots now!
If chevy buick and Cadillac are going to be global brands then they need to be in every region!
There is NO Detriot big three anymore! Most Chevy cars are based on German platforms with Korean design. I see you are proud of what you view as ‘American’ cars but most of the Chevy and Caddy line up would fit poorly on European streets/parking lots. Also, gas is very expensive over there.
Europeans already have and reject Chevy and Caddy gets imported via third parties. Opel may be having a hard time but your solution would fail badly. Also, Buick is not a global brand is its lineup is filled with Opel based cars.
We can’t make ‘them’ drive ‘our’ cars when half of Americans reject them. If Europeans pound sand, as you say, Americans loose money.
PS: Do you know that most Ford cars are now Euro based?
I dont care what they are based on! If your not going to be a supporter of chevy buick and Cadillac then you don’t deserve to be backed by GM the corporation!