GM sees profitability in Europe even if economy fails to revive image

In Europe General Motors  will become again profitable even if the economy in the old content fails to revive as forecast, GM’s president Dan Ammann said in an interview at the World Economic Forum in Davos.

We are generally on track” Mr. Ammann said. The Russian economy is facing a “meaningful disruption”.

General Motors plans to end years of losses at its Opel unit by mid-decade by introducing new vehicles like the Mokka compact crossover and the Karl – the replacement of Agile for 2015. The company will also start building Buick vehicles in Europe, vehicles to sell in the United States.

Last year Opel delivered 1.08 million cars – up 3 percent compared to 2014 but GM announced losses of $387 million in third-quarter – up 149 million compared to second quarter. Market share of Opel vehicles rose by 0.1 percent to 5.74 percent – the highest level for Opel since 2011.

Europe is still not recovering as expected, but the auto market in EU and EFTA rose 5 percent to about 13 million vehicles in 2014 according to a report from ACEA. On the same time, for 2015, IHS Automotive forecasts an increase of 3 percent – but the old continent will not return to pre-crisis levels earlier than 2020.

In the past 12 year Opel losses hit around $18 billion.