This past July, Opel returned to profitability for the first time in two decades under its new owner, French automaker PSA Group. General Motors sold Opel, Vauxhall and the majority of its European operations to PSA in 2017. While the news of Opel’s profitability likely stung GM, the worst is far from over.
A rather damning report published last Tuesday from German newspaper Handelsblatt detailed the inside of Opel one year after trading hands from the American automaker to the French company—and it’s not great. According to the paper’s sources, decision making has fled Opel’s German headquarters with the shots called in Paris these days. The move has instituted a “culture shock” for upper management inside Opel, paving the way for employees to respect the French “pecking order.” The sources insinuated GM was far more hands-off in an appreciated manner.
PSA CEO Carlos Tavares reportedly has the final word on all Opel decisions, which has left many questioning what Opel stands for under the automaker. “Nobody knows what Opel stands for,” said a manager, bringing up the utter lack of differentiation between an Opel Grandland X and Peugeot 3008.
“Lohscheller is just a puppet,” said another insider, speaking of Opel CEO Michael Lohscheller.
Not only has PSA flipped Opel’s culture upside down, but the effect has led to an exodus of talent from the brand. Numerous longtime managers have jumped ship for new opportunities as PSA prepares to slash 3,700 jobs from Opel’s 18,000-strong operations workforce. And employees at Opel’s Rüsselsheim development center have been left out in the cold. While GM often utilized more than 50 percent of the space’s capacity, PSA has dwindled its projects to roughly 20 percent capacity. That figure will likely fall lower after GM finishes any remaining contracts with the center by 2020.
“The hallways are empty,” a worker told the newspaper. “There’s less laughter than before.”
And the morale problems compound upon a larger one: Opel’s ever-eroding European market share. While the brand turned a profit earlier this year, market share slipped to just 5.7 percent, down from 6.2 percent year-over-year.