That’s up from the original $4.5 billion estimate as GM continues to pour investment into Opel and its European operations while it’s still owned by the U.S. automaker. However, GM reassured the long-term benefits of unloading Opel, Vauxhall and its European operations outweigh the short-term costs, according to Forbes.
In the future, the money spent on Opel and European investments can be funneled into profitable markets like booming China and North America.
“We have been spending approximately $1 billion a year in capex [capital expenditures] in Europe,” Stevens said in an April conference cal. “We would expect this to be fully recaptured and create about $1 billion annual improvement in adjusted automotive free cash flow, all else equal.”
GM has been motivated to drop money-losing markets from places it does business in. Recently, GM also announced its intentions to pull its vehicle sales from the country of India as well.
Opel and its new owner, PSA Groupe, believe the sale may be finalized by the end of July, ahead of the previous end of 2017 estimate.