Prepare For Years Of Hemmorhage: Opel In No Hurry To Stop The Bleeding
If you are anxious to hear what Opel is going to do to stop the bleeding of money (just in case you are holding GM stock,) then you need a lot of patience. GM Europe CEO Karl-Friedrich Stracke thinks he might have a plan within two to three months. He might have a plan. Setting the plan in motion may take longer.
“Two to three months I think we need for sure before we can speak more precisely on further details,” Stracke told just-auto. Incredulous, just-auto called Opel in Germany, where a spokesman confirmed the apparent lack of urgency. Rüsselsheim says that “a rough timetable is being worked on.”
Remember: In February, Stracke said he expected and agreement with the unions in “a couple of months.” Now, he wants to have a plan some time in summer.
Last year, Opel lost a jumbo-sized $747 million. Nobody seems to be in a big hurry to plug the huge hole through which Opel loses money that GM makes elsewhere. This year, the losses might be higher. Karl-Friedrich Stracke did not want to make a prognosis in Geneva, and blamed the Euro crisis. At the same time, BMW, Daimler, Audi, Volkswagen silently wish the Euro crisis will continue: With a low Euro, their exports and foreign earnings will continue to produce bigger profits. Opel has been mostly kept out of the lucrative emerging markets. After Mercedes and BMW had reported record sales, Audi today said it is “well on its way” to achieving record car sales in the first quarter. Audi’s deliveries to customers rose 16.6 percent in February. Little BMW today announced a $9.8 billion pre-tax profit for 2011, well ahead of giant GM’s $7.2 billion pre-tax profit. You won’t hear any of them complain about a crisis.
There isn’t much Stracke can do. Contracts with the unions forbid further plant closings or firings until 2014. A breach of these contracts could become immensely expensive. The GM-PSA alliance buys Stracke time. He can wait until Detroit and Paris come to terms. Common PSA-GM models can’t be expected before 2016, at the earliest.
Years of losses are assured. Even Dan Akerson is convinced of that. “I think it’ll be a good year or two before we can achieve profitability in Europe again,” Akerson said yesterday in San Francisco.
Any hope for government aid would be futile. Ever since the abortive sale of Opel, Berlin does not have much sympathy for Opel. Now, a dead Opel seems like the solution for too much European capacity.
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What is the difference between a Stadt and a Staat? Over the years haven't several US and foreign auto manufacturers established design and engineering offices in California? How have they worked out? Would Opel engineers like to move to California?
As far as a remember Opel always made rental grade cars - German equivalent of Chevrolet. Now there is a Chevrolet as a GMs world brand. Who needs Opel? It cannot compete with BMW or Audi. Audi always charged more for their cars than Opel and for good reason. Ford? Yeah but how about Chevrolet? And Ford is still better (and to good degree) than Opel. If Opel goes global Chevrolet will kill it. So it will not happen. The plan was to make it premium. But then there is Buick. Would buy Opel rather than Buick? I do not think so so. So what left - to make it Germany-only equivalent of Buick. But it has no reputation of being premium car. Buick at least always made premium cars. And how you can have premium brand in Europe if there is already Cadillac, which is RWD which premium car should have. Simply put it - nobody really needs Opel. Just rename Opel engineering center Chevrolet and sell Opel to Russian mobsters or Chinese. Nobody is going to cry after Opel. Ford calls German Ford - Ford why GM cannot not call Opel Chevrolet?