While over the last years the rumors of the sale or demise of the Opel brand were all over the news almost every day, topping out with a failed sale, the brand is now ready to stage a comeback.
General Motors has issued a huge vote of confidence in the brand, deciding to wipe away years of efforts made with the Chevrolet brand – ultimately acknowledging the internal competition triggered by the overlapping model lines. While Chevrolet should have been the mainstream brand and Opel positioned more upscale – the reality was the brands actually targeted the same customer base, denting profit at both divisions.
The hard part is that while Opel is back on the mainstream avenue, the brand had lost (until last year) market share for the last consecutive 14 years. The company is now triggering its largest marketing effort in its home market – Germany, where Volkswagen for example, outsells Opel by 3 to 1.
“It’ll take inspired leadership and solid products to get Opel back on track,” sais Tim Urquhart, a senior analyst for IHS Automotive in London.
General Motors aims to stop losing money with the Opel/Vauxhall divisions by 2016, a goal that has become even more important as the mostly Asian international division (besides China) is now also unprofitable due to pricing pressure. Meanwhile, the US automaker is backing the European asset with $5.2 billion in its swing effort, which should be over according to the company’s forecast around 2022.