The appointment of Mary Barra as the Chief Executive Officer of General Motors, and the related shattering of the glass ceiling associated with the first female chief executive of an automaker, may have overshadowed an intricate development within the automaker concerning its vice chairman Steve Girsky. Specifically, GM announced that 51-year-old Girsky, who was GM Vice Chairman as well as the Chairman of the Adam Opel AG Supervisory Board, will leave GM in April 2014.
Girsky’s “in” at The General was part of the same bailout-related influx of new blood that made Ed Whitacre CEO after the ousting of Fritz Henderson while making Dan Akerson a GM board member (and later CEO to replace Whitacre). With directoral responsibility for global corporate strategy, new business development, global purchasing and supply chain, global product planning and program management, global connected consumer/OnStar, and GM Ventures LLC and global research & development, Girsky most certainly didn’t have it easy. And that’s not to mention his serving on the boards of GM Ventures, GM Financial Company, and European Automobile Manufacturers Association. To sum it up, the ex-consultant, advisor, and analyst oversaw a significant amount of areas at The General, possibly the most important of which was GM’s Germany-based subsidiary Opel.
The Guessing Game
Keeping in mind his relatively young age (for an executive), we’re left pondering the following possibilities surrounding Girsky’s departure:
Was it planned and voluntary? There were rumors that Akerson would leave in 2014, but we never heard any about Girsky’s departure.
Was it political or sentimental? Some thought Girsky was a candidate for GM’s CEO job.
Was Girsky forced out? Perhaps there is significantly more to the situation than what we know here and now.
We hope to find out the answers to these questions at some point in the near future. For now, though, all that’s certain is that Girsky will move to a senior advisory role until he leaves the company in April 2014. And that puts a certain strain on Opel.
Oh, Opel
The issues surrounding Opel (and sister brand Vauxhall) are numerous and well-documented. Today, we can sum them up like so: the division has lost money every single year so far during this century.
Opel is a separate business operating in and of itself while being owned by GM, it’s sort of “a company within a company”: it had its own C-level executives, its own board of directors, and its own financials. Some would say that it’s the only remaining element of GM’s original “divisions” versus today’s “brands”.
But given that Opel isn’t entirely solvent, it needs to secure funding from parent GM while having an impact on other issues within The General (such as product planning and development). That being the case, Opel should have a seat or two on the main GM board. Girsky’s departure changes that, taking that seat away.
What Now?
With one less seat on GM’s board of directors, it would seem that Opel now has one less supporter within its parents’ house. The development is noteworthy and should not be taken lightly, sine it seems to concern those involved with Opel directly. It also puts pressure on fresh-but-settling-in Opel CEO Karl-Thomas Neumann.
In other words, it seems that without a supporter at GM proper, it’s make-it-or-break-it time for Opel. With Barra at the helm and nobody to defend Opel, the next few years will certainly be interesting to watch.
Comments
The press release about Barra following Akerson said about Girsky that he “will move to a senior advisor role until leaving the company in April 2014. He will remain on the GM Board of Directors.”
I read that as meaning that Girsky is being stripped of all decision making powers except his post at the GM Board of Directors, from now (or from January 1st, 2014) to April 2014.
Concerning Opel, this would mean that Girsky would have to be replaced as chairperson of the Advisory Board (“Aufsichtsrat”, according to German stock company laws) of the Adam Opel AG.
I don’t understand the configuration of the various boards in General Motors Company, and the relative powers of the “Board of Directors” vs. the “Executive Committee”, but it is public knowledge that the current Opel CEO and President, GM Europe has a seat on the “Executive Committee”.
“it’s make-it-or-break-it time for Opel. With Barra at the helm and nobody to defend Opel, the next few years will certainly be interesting to watch.”
There is still Karl-Thomas Neumann who can defend Opel as he is “a member of GM’s Executive Committee plays a key role in the global leadership of GM.”
“it’s make-it-or-break-it time for Opel”
Why? If GM cuts Opel, GM would loose more than one million units sold, would be surpassed by Volkswagen, Toyota and Hyundai/Kia, it would loose one of the most important R&D-centers within the entire group and GM would retreat completely from Western and Central Europe, a market with more than 500 million people. Opel is also very important for Buick’s sucess in North America and China where most Buicks are based on or simply rebadged Opel cars.
I’m not sure he ever intended being more than a temporary full-time employee. I also think pulling the plug on the Peugeot JV made him the odd man out, with the other two passed over from CEO getting expanded roles.
Anyone know if he had favored the Manchester United chevy sponsorship?
Opel is a dinosaur. It is stuck in the past with an overly complicated and expensive labor structure. The engineering capability is over rated – note that the Volt, CTS & Corvette were engineered in the U.S. You’ve dealt with Pontiac, Hummer, Saab, Saturn &Holden. Enough with the kid-gloves GM, take serious action to stem the losses at Opel!
Is it worth a million cars sold vs continued loses every year?
If opel can’t sell on their home turf then why even keep them around?
For you opel supporters when are you going to start making a profit?
This info makes me think that GM’S master plan is to get rid of opel! If GM is going to stop selling chevys in Europe and start making buicks and cadillac s more available in Europe! I think this allows GM to pressure opel to make a profit or be replaced by buick and cadillac! GM will give opel a hand full of years to get their act together meanwhile GM will have time to bring new buick and cadillac models to Europe to take over if opel keeps slipping!
Brilliant!
The people of Europe know even less of Buick than they did of Chevrolet, so there’s your idea torn to pieces.
If you believe that Buick will replace Opel, not only are you deluded, but you’re going to see a repeat of Chevrolet in Europe.
Cadillac isn’t going to do it either, not by a long shot.
@Phil
The Volt was developed under the rule of Opel engineers. The leading manager of the Volt project was Frank Weber, a former Opel engineer/manager. Most of your Chevys sold in US are based on Opel developed platforms.
@Brian
What’s wrong with you? Buicks are Opels (except Enclave and LaCrosse which is based on the Opel Insignia). Why should GM start selling identic cars under a foreign and completely unknown brand in Europe and being sucessfull??? Why? Explain that! No one in Europe knows the Buick brand…no one! There is no plan of selling Buicks in Europe! And even for the case that Opel will no longer be sold in Europe, GM will not start selling Buicks because this makes absoluteley no sense. OK, you can argue, GM makes a lot of things that make absolutely no sense. For that case you are completely right but this would be the top of the most idiotic things GM has ever done. BTW if Opel disappears your beloved Buick brand will also disappear from North America or at least stay on a very very low level because engineering Buick cars will no longer be profitable if the costs can’t be shared with Opel.
The new Caddys are very nice cars in my opnion. I saw them on the Francfort Motorshow and loved them but the design is too exotic for Europe, the image is very (!) bad and the brand is unpopular. It will be very hard for GM to make profit with Cadillac in Europe. For the last decades GM tried several times to establish the Cadillac brand in Europe and failed every time. Perhaps this time the chance is better because the new products are really good (still not on the same level as BMW or Mercedes but very close) but also this time GM will not sell many cars and because of that not earn a lot of money in Europe with Cadillac
It’s interesting to get your opinion on Cadillac from a European perspective. I was thinking that the new ATS and CTS have rounded their edges to try to appeal to a more global market. It sounds like that may not be enough to reach the European consumer.
I agree with you that GM would be foolish to introduce Buick into Europe. I do think that adding Opel models (like the Adam, which would be ruined with a Buick grill) through the Buick dealerships would make a lot of sense. I think younger buyers would be much more interested in a new Opel rather than their grandfather’s Buick. A brand within brands makes a lot of sense. Sergio is a big believer in this philosophy (and he has made Ram a separate brand and more recently SRT is badging the Viper). The cost of the additional brand is minimal when using the existing dealership network. Essentially Buick has this already with GMC, and I think this is much more successful an approach than badging trucks as Buicks. I am sure the GMC demographic is much younger than Buick, so reaching the younger car buyer may require Opel.
I can argue the point of buick and cadillac in Europe, you think it’s idiotic to have buick and cadillac in Europe but you think it’s ok to have opel and Vauxhall there losing millions every year for well over a decade!
GM is going to give opel 5 to 10 years to become profitable and if not then I think they will replace them with buicks and cadillac!
GM is already losing money With opel so what’s the difference if their losing money with buick and cadillac?
I think GM is trying to break the European Union and the high manufacturer cost!
As for the design studios in Europe, those cars were designed by opel because GM asked them to! Those same designs would of come from the us or Asia or Australia!
A design studio is just a office and work site to create ideas, that office can be put in any part of the world and be a winner!
Read between the lines GM is giving opel a time table, become profitable or expect changes to come
Buicks are going to be largely rebadged Opels, so what’s the difference? Furthermore, based upon Buick’s US sales currently, it hardly justifies itself in the US except for the pairing with GMC and the huge demand for Buicks in China. Buick, forgetting GMC, cannot possibly be profitable in North America. Based upon the very low residual values, it is a very impaired brand. The big bright spot for GM in North America is Cadillac. I believe, with the right product, Buick can make a lot of sense sandwiched between Chevy and Caddy, but GM needs to work quickly to fix Buick. Some of the new Lincoln models might steal from Buick’s core customer.
Buicks have no problem posting a profit for the us market when you think about the shared platforms they have with chevy and cadillac!
This is why buick is much more valuable than Pontiac, buicks can be sold at much higher price then Pontiac can!
What happens to opel if they keep losing money?
Alfred Sloan explained his famous market segment strategy of “a car for every purse and purpose” in the 1924 annual report to shareholders.
Simply building Buicks off of shared platforms is not enough unless it’s a very significant market (for example I am a big believer that selling a similar full sized pickup as GM/Chevy results in more sales).
For Buick to be wedged between Chevy and Cadillac it has to have not only a different price point, but also have another purpose. I think Buick shouldn’t have 3 front wheel drive sedans. Two Crossover is about right, but keep the off road capable and large SUVs for GMC and eliminate and any crossover/SUV overlap between Buick and GMC. Perhaps a small sedan like the Opel Adam would make sense and a large flagship, but there isn’t a need for both Verano and Regal. I think they need a unified look with Opel which needs to go directly at Lexus with German styling (similar to Audi and nothing like Cadillac) with few options and in general they come well-equipped. They also need something unique, like all Buicks come standard with AWD and adaptive cruise, lane departure, front-end and backup collision protection, NAV and self-parking. A Buick won’t be cheap with all these extras, but a very high value when compared to equipping a Cadillac (or even a Chevy) as well. Keep the high performance cars in Chevy and Cadillac. Give Buick a purpose at its price point- AWD and well-equipped cars and crossovers.
I also would like to Buick to advertise it’s German DNA and stop the sports celebrity ad campaigns. I don’t believe Shaq drives a Buick or fits in one either.
@German
The Volt was definitely NOT an Opel project – it was not developed under the “rule” of Opel engineers. You should get to know names like Jon Lauckner, Tony Posawatz, Larry Nitz, and Denise Gray. Also, the last time I checked you don’t see many Opel platforms associated with Corvette, Silverado, Tahoe, Camaro, & Acadia. Opel can take some credit for the Cruze, Impala & Malibu. That sure doesn’t sound like most Chevys being based on Opels to me. The real issue here is that Opel is not competitive on a global scale and the German government and unions would rather have the American tax payers, employees, & shareholders pay for their continuing poor performance. GM should continue to consolidate it’s operations into fewer development centers to more efficiently develop global products for all the remaining brands.
@Phil:
The Voltec drive train was first presented in the “Opel Flextreme” concept car shown at the 2007 IAA (aka “Frankfurt Motor Show”). This Opel development of an electric drive train with range extender was called “Opel eFlex” by the developers.
After that, GM pulled together an international team in the USA, to be led by the leader of the Opel engineering team which developed the “eFlex” shown in the “Flextreme” concept car, in order to develop the concept into a marketeable product, and this team developed the twin cars “Opel Ampera” and “Chevrolet Volt”.
Those are the facts.
Sure, if Opel would not be part of one of the three largest automakers of this world, the company would have much more problems to bring this to market alone. On the other hand, General Motors without Opel would be a man without his left leg, or without his right arm.
As to the dreams of some warriors for world domination by the USA, simply closing down all Opel/GM factories in Europe, the International Development Center in Rüsselsheim (and the drive train engineering center in Torino) would certainly rejoice Ford, Toyota, Hyundai and all the European automakers, and at the same time destroy GM’s image in Europe without any chance to recover in this century. GM would be reduced to the sizes of FIAT/Chrysler and Hyundai, and shrink even further. That’s my estimate, and I know as we all do, that prognosis is an unsecure venture, especially when it concerns the future.
So, maybe, GM could recover from self-destruction in Europe by leading the Chinese automobile industry to the world market, as they already start doing by selling exports of the SGMW joint venture Wuling and Baojun cars as Chevrolets around the world.
Who knows…
“The German” thinks that “the design [of the new Cadillac cars] is too exotic for Europe” — well I think that their design very much resembles the current design of Mercedes passenger cars, both using squared shapes and sharp creases in the sheet metals.
The problem for Cadillac is that their class of car is — at least in Germany, which is still the largest automobile market in Europe — dominated by fleet sales to leasing companies which lease them to companies as the business cars for their employees, and in this business the buyers look very sharply on the resale value after the end of the lease. A new and so exotic brand as Cadillac has a very hard time to break into this market.
I’ll ask again what is the difference between selling buicks and cadillac in Europe and opel and Vauxhall losing millions year after year?
If your saying that selling buicks and cadillac won’t work then opel and Vauxhall aren’t working either!
Either way GM is losing millions every year!
“I’ll ask again what is the difference between selling buicks and cadillac in Europe and opel and Vauxhall losing millions year after year?”
Simple; Public image.
In fact, I think you’ll find that’s the same reason why Chevrolet failed in Europe; it had a shit public image!
Really, if GM (US) didn’t turn out garbage cars from the 60’s to the 90’s, and tried selling them in Europe, this wouldn’t be a problem. The fact is, GM (US) HAS sold garbage and inferior cars in Europe for decades, and it’s not unreasonable for Europeans to look at the cars with skepticism.
Chevrolet tired to change their minds with Daewoos, but that only further cemented the image of an inferior product.
Essentially, even if Opel/Vaux are selling poorly right now, things would be MUCH WORSE if GM sold only Buick or Chevrolet in Europe only. Opel and Vauxhall are better positioned to make money in Europe than Chevrolet ever could.
I wouldn’t be surprised if GM didn’t make a dime with Chevrolet in Europe; the consumers there have spoken with their wallets – Chevrolet is not wanted in Europe.
Brian asks about “Opel and Vauxhall losing millions year after year”.
I for my part am much more reticent to talk about such “losses”. As Opel is an integrated part of the overall GM corporation (probably being tied and bound by an “Gewinnabführungs- und Beherrschungsvertrag”), the dominated part cannot negociate the transfer prices of “business fees”, “licence fees” or the transfer prices of cars imported from GM Korea or GM USA.
So, the “losses” of the Adam Opel AG might well be a case of creative book-keeping as the losses of the European subsidiaries of other US-american corportations, like Starbucks, Google, Apple, or Amazon, which all avoid to pay any taxes in European taxes by not reporting any profits in those countries where they operate flourishing businesses. Since the real profits all trickle down to some off-shore companies, and thus avoid to pay any taxes even in their home turf, the USofA, these business practices have even created a scandal in the US.
So, I do not know enough about the Opel-GM bookkeeping, and thus am very reserved about asserting “big losses” by the European subsidiary of GM.
What we do know for sure, though, is that the General Motors Company lost 11 thousand million USD since the “new GM” emerged from the real bankruptcy, and that GM Company has been subsidised by that amount by the US government, taking over those losses. Which part of those 11 thousand million USD are reported by the European subsidiary, is an open question. See above.
@Observer7
You are referring to the same Flextreme based on the GM Precept from 2000 as part of the Partnership for a New Generation Vehicle challenge posed by the US Government. Check your “facts”. http://www.evworld.com/article.cfm?storyid=112
I’m sure stock holders are happy knowing the company is posting loses when they really are not!
The European Union would not allow that in any way!
With Europe bleeding money left and right they need all the tax dollars they can get there hands on so I don’t think if GM is cooking the books to make opel look bad it would take very long to uncover! It’s been over ten years of loses!
YOU Can Cook The Books For THAT Long With Out Being Caught!
Yfda
Anyone who has read Steve Rattner’s “Overhaul” will note the auto task force wanted Opel sold or JV partner. Fritz Henderson proposed a sale and was shot down by the board. If Opel was sold, I believe GM stock price would have been sufficient for treasury to recover their investment a year ago. If treasury would have broken even or turned a profit, the PR value would have been enormous. The current GM stock price might be double the current price. Ultimately GM could have reentered Europe with a clean slate.