Having launched its Opel brand in Australia in September of 2012, General Motors has confirmed that it will shutter operations in the country effective immediately. The network of 20 dealers and 15 Melbourne-based head office staff were informed of the decision today.
In returning to Australia, sometimes referred to as the world’s most competitive automotive market, GM attempted to position the relatively unknown Opel brand as a somewhat premium brand that carried a price premium over other non-luxury marques. The brand launched with three new models, including the Corsa, Astra, and Insignia, with the Mokka subcompact crossover expected to join the lineup in September. Unfortunately, sales failed to meet expectations, with the brand struggling to make a profit.
“We can’t sell our cars at the price they need to be in order to meet our volume targets,” said Opel spokeswoman Michelle Lang.
“The Astra small car was supposed to underpin our brand but with the prices of most rivals dipping to close to $20,000 we just couldn’t compete.”
Opel management in Germany set sales targets to of 15,000 cars within the first three years, but the brand sold 541 cars in 2012, and 989 in the first six months of 2013.
During the 1990s and early 2000s, some Opel models (such as the Astra) were sold under the Holden brand, but in recent years, General Motors closely aligned Holden with the global Chevrolet brand. The decision to exit the market, thereby decreasing the number of available car brands in Australia from 67 to 66, will result in the remaining Opel inventory being sold at clearance prices. Meanwhile, the responsibility for warranty, parts, and service work of existing fleet of Opels on the road is still to be determined, but will likely be serviced by Holden dealers.
Update: following is the official announcement by Opel of Australia:
Opel Australia will cease operations and will commence winding down its network immediately.
In order to be competitive, Opel Australia would need to follow recent competitor price reductions, and significantly reposition the price of its core volume models. These changes, combined with the continued investment required to ensure brand awareness, result in a business which is not financially viable for any of the parties involved.
Opel will now begin analysis together with Holden regarding the potential for future Holden- badged niche product, in order to ascertain if opportunities for individual carlines exist.
Opel Australia is working closely with employees, dealers and suppliers to conduct this closure process in an orderly and responsible manner. As always, customers are of the highest priority, and Opel Australia will remain in close contact with them, to ensure all on-going obligations to these customers are met.
Customers are encouraged to contact the Opel Customer Assistance Centre on 1800 993 677 with any concerns or questions.