Opel Really Needs A New CEO. Badly

Bertel Schmitt
by Bertel Schmitt
opel really needs a new ceo badly

Opel will remain a money draining leak in the mother ship for the foreseeable future. This is one conclusion after reading an interview given by Opel’s interim CEO Thomas Sedran to Germany’s Wirtschaftswoche. Another conclusion would be that Opel needs a chief.

Sedran is “sure that we will be profitable by mid-decade,” but this is an easy claim for any Opel CEO. Even non-interim chiefs of Opel have a very short shelf life. The plans revealed by the former management consultant (Roland Berger, Alix Partners) don’t sound like Opel will be profitable in this century.

Sedran says that all European manufacturers need to develop a business case where no money is made in Europe. That does not sound too promising for a Europe-centric Opel. When asked about exports, Sedran names Australia and North Africa as hot new markets. Uh-oh. All of Australia has the population of Shanghai, and North Africa currently has other problems.

Joint production with alliance partner PSA is not a topic for Opel, says Sedran. The two are negotiating, mind you negotiating joint development of four new model series. The model series are scheduled to be launched by 2016/2017. Someone who has more experience in running a car company would have wanted to know long ago who will design a few new model series due four to five years from now. One of the most important parts of the development of a new car is production engineering. Joint development with disjoint production does not promise quick savings.

Sedran does not just want Opel to become profitable in a few years, he also wants Opel to advance to Europe’s second largest brand. Sure, that’s a noble goal. Where does Opel stand these days? “As everybody knows, we are the third largest brand in Europe.” Really? Well, Herr Sedran, if you want to play the brand game, you need to play it right.

Opel/Vauxhall sold 764,000 units in Europe from January through November, which places it after Volkswagen and Ford and before Renault. But Opel/Vauxhall is not a brand. It is two brands. 219,000 of the sales are under the Vauxhall brand, giving the Opel brand 545,000 units, which would place Opel in rank 8, and which would let the Vauxhall brand beat Dacia. Or should Vauxhall’s UK customers interpret Sedran that he wants to give up Vauxhall? We don’t think so.

Few people will care anyway. Soon, Sedran will join the swelling ranks of former Opel CEOs. According to German media, Opel has its eyes on Volkswagen’s former China chief Karl-Thomas Neumann. However, Neumann is still under contract at Volkswagen, and Wirtschaftswoche says that Volkswagen is ornery and does not want to give Neumann to Opel before his contract ends in summer of 2013. Opel has other candidates and could choose one this month, says the magazine.

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  • Dimwit Dimwit on Dec 18, 2012

    Opel is marking time, waiting for markets to improve and trying to save as much money as they can while doing so. It's a thankless task which means new mgmt every two years as the stress kills the exec suite. None of this means anything. GM knows that massive investment at this time is useless and the future isn't all that bright at present. If Greece had been taken care of in a timely manner then they could have made some manoeuvres that would have them looking a lot healthier. I betcha that there's predictions of *potential* profitability somewhere around 2020. They just need to hang on and not bleed GM dry.

  • Henkdevries Henkdevries on Dec 18, 2012

    This almost sounds like sports. Changing coaches on a regular basis usually has nothing to do with the coach but more with the team/organization. Too bad GM is that big, they should have just went bankrupt. Out of the ashes something new and beautiful (at least prettier than the current) would have probably emerged.

    • See 1 previous
    • Lorenzo Lorenzo on Dec 20, 2012

      @Robert Gordon Good point, and it applies to owners too. The O'Malleys owned the Dodgers for 48 years, had two managers for 45 of those years, finished in first place 15 times, second place 17 times, won 12 league championships and 7 world series.

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