General Motors' Chief Financial Officer says it is “too soon” to determine whether the European auto market is starting to level off. Europe's debt crisis has dragged down new car sales in the region for the past several months.
Although car sales remain weak in the region, GM CFO Dan Ammann says the automaker's attention is now shifting to the issue of over capacity. GM has already announced plant closures to address the issue and could further reduce staff and work hours to ensure capacity is better aligned with the health of the overall market.
"People are coming to grips with the fact that there has to be, over time, a fundamental adjustment to capacity or, miraculously, somehow volumes have to improve, which I think in the current economic environment, no one is placing a bet on right now,” Ammann told Reuters.
He added that it is “too soon to make a call” as to weather the market is showing signs of stabilizing.
General Motors' Opel unit has lost $16 billion over the last 12 years and some analysts predict the European division will exceed those losses over the next decade.