General Motors Europe Gets Closer To Profitability In Q2 2015
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General Motors’ European division continued to inch closer to breaking even in the second quarter of 2015, posting a $45 million loss for the period.
While the news isn’t exactly great — a loss is a loss, no matter how you look at it — the results do represent a noteworthy improvement of $260 million compared to the $305 million loss posted during the second quarter of 2014.
GM has been aiming to turn a profit in Europe by the 2016 calendar year, and says that the Q2 results “demonstrate we are on path to [European] profitability in 2016”.
| Operating Segment | Q2 2015 | Q2 2014 | H1 2015 | H1 2014 |
|---|---|---|---|---|
| GM North American (GMNA) | $2780 | $1385 | $4962 | $1942 |
| GM Europe (GME) | ($45) | ($305) | ($284) | ($589) |
| GM International Operations (GMIO) | $349 | $315 | $720 | $567 |
| GM South America | ($144) | ($81) | ($358) | ($237) |
| GM Financial | $225 | $258 | $439 | $479 |
| Total Operating Segments | $3165 | $1572 | $5479 | $2162 |
Other noteworthy details GM Europe in Q2 2015 include:
- Q2 results demonstrate the automaker is on path to profitability in 2016
- The European automotive market is continuing to improve despite continued weakness in Russia
Wholesales decreased 2,000 units, driven primarily by decrease of over 70 percent in Russia partially offset by growth in Western Europe and Turkey - Market share was 6.3 percent, reflecting the wind-down of the Chevrolet brand and Russian operations
- Opel / Vauxhall brand continued to increase market share
- GME Q2 EBIT-Adjusted increased approximately $0.3 billion year-over-year, key drivers included:
- Price: driven by favorable pricing on recently launched products, including the Corsa and Vivaro
- Cost: driven by absence of restructuring expense, favorable material cost performance, partially offset by unfavorable increased material cost on recently launched vehicles
- Other: primarily related to foreign exchange rates associated with Euro, Russian Ruble, partially offset with British Pound
- H2 2015 performance expected to be impacted by seasonality and launch related costs
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Opel has always made GM money through models sold under the Buick badge in China and America; from the platforms used globally by Chevrolet.
Opel looses money on paper due to weakness in its home market but only the Opel brand, not it’s European developed vehicles, is landlocked in Europe.
This is why GM went again the wishes of the short sighted auto task force and kept Adam Opel AG.
The next step in a few years should be to build a global Opel and grant Buick independence.
Good to see GM Europe is closing in on profitability and apparently ahead of schedule.
I do not think Opel works as a global brand. It would step on Chevrolet’s toes in international markets. To much product overlap.
In markets where Chevy is a entry level brand as in India, South America parts of Asia, Opel could be introduced as a semi premium brand as Buick is in North America.
I totally cannot understand why GM does not globalize Opel and/or Buick at least in the markets of tommorrow, especially India and other growing Asian markets like Vietnam and maybe Iran.
Smart. These markets aren’t really ready for Cadillac yet and Opel /Buick would fill the same space it has in China.
It’s interesting as I watched the car charts every month. Loses money yet sells very well all over Europe. In many countries it’s number one. Sounds extremely well in the UK and Germany etc. A few markets Scandinavia for example it is nowhere. Jim is also the leader in many South American countries yet is losing money there?! They kill Toyota and depending on the country and our first second or third with Volkswagen in fear was that one way I sent you videos they kill Toyota and depending on the country and our first second or third with Volkswagen and fiat. Imagine being number one in those countries and losing money?