GM still looking to build new model at Opel main plant image

Chief Executive Officer Mary Barra said General Motors is sticking to plans for its Opel unit to build an all-new vehicle at the brand’s main plant in Germany as part of an effort to restore earnings in Europe.

Opel is investing 4 billion euros ($5.5 billion) in the four years through 2016 to develop new vehicles and engines as GM’s European division, which also includes the Vauxhall brand in the UK, targets a return to profit by mid-decade. GM has lost more than $18 billion in the region since 1999. The US carmaker is forecasting that group profit will increase “modestly” in 2014 because of spending to fix troubled European and Asian units.

Opel is “clearly a vital part of the company,” Barra, 52, told journalists today at the division’s headquarters in the Frankfurt suburb of Ruesselsheim. “I thought it was very important to reinforce in person my commitment, and GM’s commitment, to Opel.”

Barra, the first female CEO of a global automaker, is making her first trip outside the US since succeeding Dan Akerson as head of GM on Jan. 15. Her schedule in Europe includes visits to the carmaker’s engineering and production facilities in Ruesselsheim. Barra was head of product development under Akerson, who led the automaker out of government ownership that followed the company’s 2009 bankruptcy reorganization.

General Motors decided in December to pull Chevrolet out of Europe, reversing a decade-old sales effort to promote the US nameplate in the region, to give Opel more scope to expand. Opel will shut its car plant in Bochum, Germany, by the end of this year, the first automotive assembly plant to close in the country since World War II.

Opel said on Dec. 12 that the Ruesselsheim plant, which makes the Insignia mid-sized car and is scheduled to start building the Zafira Tourer van in 2015, will be assigned a new model whose details will be disclosed later.

Via Bloomberg