GM Moving Opel Upmarket

Edward Niedermeyer
by Edward Niedermeyer

Automotive News [sub] reports that Opel is moving upmarket. It's GM's attempt to "democratize technology" and emphasize their Euro-brand's "traditional German manufacturing attributes." The new strategy is designed to move Opel away from its image as "the European Chevrolet"– so that Chevrolet can become the European Chevrolet. "Opel and Chevrolet will be bookends with a clear position for both," GM-Europe President Carl-Peter Forster promises. "Over time, we will emphasize Opel's German heritage, engineering and design." But don't worry: GM plans to keep the German domestic affordable. "We are not talking about a premium price for Opel," Forster said, "but a one percent to three percent increase is foreseeable." Design, technology and image are all part of the brand touch-up– not, Forster insists, a "reinvention." Yes well, Europe is facing a premium small car glut as Fiat, MINI and others seek full-sized profits from compact cars. With GM dependent on overseas sales to keep the wolf from the door, Opel had better hope this gambit pays off.

Edward Niedermeyer
Edward Niedermeyer

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  • Justin Berkowitz Justin Berkowitz on May 13, 2008

    @Ingvar: You're so right. Selling upscale cars in Europe is extremely difficult, and it just doesn't work for mainstream brands.

    I have helped a number of friends car shopping in Europe and whenever I recommend a VW to them, I hear "Why would I get a VW when I can just get a SEAT or Skoda for less money?" And that's just VW, which has attempted to be at the top of the mainstream market in terms of premium-ness. As for other mainstream brands in Europe, many of them sell based on being cheap cheap cheap.

    Look at how much car, power, and kit you get in a SEAT or Citroen compared to a VW or Alfa or even Renault (depending on the class). Opel should be what Opel has been: cheap, mainstream cars. They don't need delusions of grandeur, they need to make money.

    Besides, didn't Opel already try this with the Signum? Look at the miserable sales failures of cars like the (gorgeous) Citroen C6 and Peugeot 607. Big, expensive, mainstream branded cars just don't sell in Europe.People just get the Audi A6 2.4D or Mercedes E270 CDI instead.

  • Ingvar Ingvar on May 14, 2008

    Yes, however, both the Peugeot and Citroen are mostly sold to patriotic frenchmen. The french are therefore not accountable in this matter, and their market is apparently big enough for them to sell those cars in that segment. The Opel Signum and Renault Vel Satis were two interesting experiments. What has to be remembered is that almost all expensive cars in Europe are heavily subsidied fleet sales to middle executives as company cars. Almost all Volvo V70s, Audi A6s and so on. Usually, there's a tax break in the near of 30 000 dollars, so therefore there's a market for strippers in that range. The point is, those buyers are heavily conservative. They will buy whatever is considered the premium brand to have in their position of the corporate ladder. And now it's Audi, BMW and Mercedes. There's a small position for being quirky, but that is not nearly as big as the market for another me too A6.

  • JJ JJ on May 14, 2008
    They will buy whatever is considered the premium brand to have in their position of the corporate ladder. And now it’s Audi, BMW and Mercedes. There’s a small position for being quirky, but that is not nearly as big as the market for another me too A6. They don't have a choice really. Because cars are way more expensive in general over here (in Europe that is), and yes, almost all cars from the EUR 25000 and more range are fleet sales, but their owners still have to cough up the monthly lease price that comes with their choice of car and depends heavily on resale value of that car. So yes, you can buy a C6 for the same amount of money you'd buy an A6/5/E for, but in 4 years the C6 will be worth $5, while the germans still have some value. This translates to much higher monthly payments if you make the progressive choice (if you actually CAN in the first place, with the fleet sales and all) to lease something else. The Germans just succeed in making cars that are desirable and look good even after 4/5 years, where the French/Americans/Japanese don't. That's their problem. Apart from that I feel there is a definite slump in the popularity of the Golf that has been there since the Golf V succeeded the Golf IV. The old one looked way better (like a quintessential Golf) and had better interior plastics. The forthcoming redesign better be good... Btw, small thing Audi A6 2.4D or Mercedes E270 CDI instead. Audi doesn't make a 2.4D and if fact hasn't done so since the Audi 100. The 270CDI was discontinued because the 5 cilinder diesel couldn't get through the emissions laws. Otherwise you're right, people choose BMWs, Mercs, Audis, maybe the occasional Volvo...that's it.
  • Justin Berkowitz Justin Berkowitz on May 14, 2008

    @JJ: Whoa - no more E270 CDI. I look away for one minute and bang, it's gone and has been replaced by the E280 CDI. I assume the E-Class will also get the new 4-cylinder 2.1 liter turbodiesel labeled as an E250 (The 250's 204 hp is more than the E280 CDI has, I think). And yeah, totally flaked out on the Audi 2.4D. In any case, I agree with your comments. Audi, Merc, and BMW really have the exec market sewn up. And truth is, mainstream brands are shrinking with "luxury" brands growing. BMW's 3-Series really has put the hurt on the Mondeo.