GM Plans to Breakeven in Europe by 2016

GM plans to breakeven in the European market by 2016.

Last year Opel reported a loss in Europe of more than £1.1billion, compared with its profitable North American parent company. Stephen Girsky, GM’s vice-president and chairman of the Opel supervisory board, confirmed the automaker’s plan to get back to profitability by around 2015 or 2016 and remain committed to GM Europe.

Girsky added that the automaker has a 10-year plan already developed, which includes the investment of billions of euro for the introduction of 23 new models and 13 new engines by 2020. GM’s strategy also includes its partnership with PSA Peugeot Citroen, which also reported dramatic losses last year. The two automakers plan to manufacture several commercial and passenger vehicles together, therefore cutting the costs of manufacturing and parts.

Dr. Karl Neumann, president of GM Europe, admitted that this is critical, because ‘we sold one million cars last year and that should have been enough to make a profit. We do have a big problem with product cost.’

Another key part of GM’s plan is the company’s purchase of Ally Financial, which will offer more competitive and better financing options across an increased number of European markets.