In a victory for GM Europe’s new president, General Motors has decided to put its Russian operations back under the control of its European wing – a signal of support for a workforce that has endured massive job cuts in the hunt for profitability.
GM made a turnaround of its European business a top priority after racking up around $18 billion in losses over the past 12 years, and is investing billions more despite calls from the likes of Morgan Stanley to sell Opel and its UK sister Vauxhall at virtually any cost.
From January, General Motors International Operations (GMIO), based in Shanghai, China, will hand the business back to GM Europe (GME) after three years. Not only will Opel’s own sales in Russia be consolidated at GME, so will those of Chevrolet, which sells more than twice as many cars in Russia, and GM’s premium brand, Cadillac.
This move also suggests that new Opel chief executive and GME president Karl-Thomas Neumann, who came in March from Volkswagen, had won out in a battle for influence within GM.
The move could also help Neumann to shore up support among his European workforce, which has endured tens of thousands of job cuts since 2000 – more than half of all staff – and will suffer the third closure of a car plant come 2014.
) - Monday, October 21st, 2013 - filed under General Motors
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