GM's Docherty Sees "Very Scary Numbers" In Europe

by Bertel Schmitt

September 27th, 2012 1:58 PM

gm s docherty sees very scary numbers in europe

GM’s Susan Docherty, who is in charge of Chevrolet Europe, is shocked by GM alliance partner PSA Peugeot Citroen. PSA, along with Fiat, are producing “very scary numbers” with discounts of as much as 30 percent off gross sale prices, Docherty told Bloomberg. Opel’s numbers can be even scarier.

Sales were down 8.9 percent across the EU in August , and the cars that sell sell at murderous discounts. According to stats by Automobilwoche [sub], the average discount of the 30 most popular cars stood at 18.9 percent in Germany. The Ford Fiesta changed hands at 34.9 percent off list, the Opel Astra at 34.8 percent, the Opel Corsa at 30.9 percent, and the Renault Clio at 30.2 percent.

“Nobody can make money in Europe when you’ve got incentives at that level,” said Docherty. GM has racked up $16.8 billion in losses in Europe since 1999. GM posted a first-half loss before interest and taxes of $617 million in Europe, and wrote down $590 million of goodwill, says Bloomberg. Ford is projecting a loss of more than $1 billion in Europe this year.

#BertelSchmitt #Discounts #Docherty #Europe #Fiat #GM #Opel #PSA

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8 of 31 comments

Commando on Sep 27, 2012

"GM has lost money in Europe since 1999..." Why the hell are they still there? On our nickle, no less. Afraid of losing market share? They are on a death march but don't want to drop out because they love a parade.

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- Sunridge place on Sep 28, 2012
  
  Come on...you can do better than that. Read the 'How to Bash GM Primer' and try again... http://seekingalpha.com/article/890841-general-motors-how-to-bash-gm-a-primer
  
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- Commando on Sep 28, 2012
  
  @sunridge place Man, I completely forgot about Step 4. I'll bash better next time. Thanks for the reminder.
  
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TonyJZX on Sep 27, 2012

did GM ever make money in europe during the 'salad days' of 2004 when everything was right in the world?

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- Jimmyy on Sep 28, 2012
  
  Actually, the current GM, Ford, and Chrysler profits, along with the supplier profits, are nothing more than a government prop job ... the so called domestic profits are driven by government bailouts, sweet government loans, IRS tax code changes, and large scale government fleet purchases. Why do you think GM and Ford stocks are falling? Because Wall Street smells a rat. It is doubtful that the domestics will be able to compete if the government support is pulled. This will end in the US as it is now ending in Europe ... Depression. It may be too late for Romney to fix it. The world's central banks know this, and they are printing money as fast as possible, hoping that the fools of the world keep spending and spending ...
  
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- Bd2 on Sep 28, 2012
  
  @jimmyy Actually, GM and Ford shares have been on the rise recently w/ GM stock being the biggest riser. From the AP story: "Surprise! The top-performing stock among automakers in the U.S. this quarter is General Motors. The company, which endured management upheaval during the third quarter and announced that it would lose substantial cash in Europe, saw its shares rise 15 percent from July through the end of September. The gain was the best since the first quarter of this year, when the stock climbed about 23 percent. GM posted strong profits in that period. GM's stock outperformed all other major automakers in the U.S. including rival Ford Motor Co., which saw its shares rise 3 percent." http://finance.yahoo.com/news/gms-3q-stock-rise-surprises-165928687.html ___________ And the "prop job" was during the Bush administration when he kept encouraging the country to SHOP, even tho we had 2 wars, a Medicare drug plan and a tax cut for the wealthy that were unpaid for. The cheap borrowing, both govt. and families (thanks to China) was one of the big reasons for the housing bubble and for vibrant auto sales. But eventually, that bubble, like all bubbles, had to pop. Basically all the "growth" for those years were based on spending on credit and it was all wiped away. As for Romney "fixing it" - I highly doubt it since he's for less regulation of the finance/banking sectors which is exactly what got us in trouble in the 1st place. And if you hadn't noticed, govt. purchases on both the state and local level have been slashed sharply over the past couple of years so it's not govt. fleet purchases that are driving domestic auto sales. But then again, it's not like FACTS ever seemed impt. to what you were pontificating about.
  
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Felix Hoenikker on Sep 28, 2012

I read on the intenets that all of our economic problems can be traced back to the fact that Obama is a Muslim. Who would have known?

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BklynPete on Sep 29, 2012

Docherty is kidding, right? Did anyone at GM take a serious look at PSA's books? Please, someone, tell me how GM's top managers continue to pull out these boners. It's just sheer incompetence, and guess who's stuck with the bill?

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