General Motors’ European subsidiary Opel could see its 2012 operating profit reduced by about €1 billion ($1.3 billion), according to Germany’s Capital Magazine.
The diminished profit could be caused by smaller sales than the company projected in its restructuring plan. Capital cited an internal forecast which allegedly predicted 1.4 million sales for Opel in 2012, about 100,000 units less than originally planned. The magazine added that GM has required Opel’s management to come up with a business plan by the end of January that would ensure the company returns to profitability. An Opel spokesman declined to comment on the report.
Opel has targeted achieving profitability by 2012 following a 20 percent capacity reduction across Europe, according to the restructuring plan presented in February 2010. Last week, Opel CEO Karl-Friedrich Stracke said he wanted Opel to reach annual profits of €1 billion starting from 2016. He also aims a margin of 5 percent based on a market share of 8.5 percent for Opel in Europe.
He said Opel will launch 30 new vehicles by 2014 to refresh its model lineup in order to make it more attractive to customers. Opel lost $1.6 billion last year and $300 million in the third quarter of 2011. GM dropped its 2011 break-even target for Opel.