General Motors Co. (GM), which yesterday posted a record annual profit of $9.19 billion for 2011, said its European arm, Opel has lost $747 million before taxes and interest.
While that’s an improvement from $1.95 billion lost in 2010, it’s not break-even as Detroit-based GM had planned until November when it pulled back the forecast as the European outlook worsened.
GM Europe head Karl-Friedrich Stracke turned aside questions about plant closings, saying there were “several options” available as the company works to stem losses.
“We clearly have work to do in Europe,” Chief Financial Officer Dan Ammann told reporters at GM’s headquarters in Detroit. “We have work to do in the South America business.
Frankly we have work to do all around the company in terms of cost opportunities.”
Further details are still a couple of months away as the parties continue talks. Labor contracts prevent plant closures through 2014, but short-term remedies such as shorter workweeks are possible.
“In order to fully use the capacity of the European plants, the planned import of Opel/Vauxhall vehicles from other global regions to Europe needs to be reconsidered,” Wolfgang Schaefer-Klug, the unit’s top labor leader, said yesterday in a statement.
“It will be important to reduce material and product costs and to expand access to foreign markets.”
GM also lost $122 million in South America last year, after posting operating income of $818 million in the region in 2010.