GM announced it will invest 4 billion euro in its European operations by 2016 to add new models, restore profit and increase market share in the region.
Most part of the investment will be focused on the development of 23 vehicles and 13 engines, which will help the automaker break even in Europe by mid-decade, according to CEO Dan Akerson. Since 1999 GM’s business in Europe, which consists mainly of Opel and Vauxhall, has gathered losses of $18 billion.
“We’re more convinced than ever Opel will succeed” in its turnaround, Akerson said. “We are also more convinced than ever that GM must have a strong and successful presence throughout Europe, and especially here in Germany.”
GM’s restructuring plan for Europe includes new models developed in collaboration with PSA Peugeot Citroen, as well as closing Opel’s Bochum plant in Germany. The latest Opel and Vauxhall models to enter the market are the Cascada convertible, the Mokka SUV and the Adam city car. During the first quarter Opel’s sales in Germany dropped 16%, surpassing the industry’s fall of 13%, and in March the automaker’s sales continues to fall 17%.
“The investment by our parent company is a clear commitment to the division’s success”, said Karl-Thomas Neumann, head of the European operations and CEO of Opel. Opel’s turnaround plan is “based on conservative assumptions, not just on hope.”