With Hummer and Saab sold off — and Pontiac and Saturn shuttered — General Motors is on a roll with its brand reduction strategy. But Opel, GM’s German subsidiary, won’t be joining either list. Late Tuesday, GM announced it has cancelled plans to sell Opel and will instead keep the company as part of its global lineup.
In a media release, GM said its board of directors decided to retain Opel and subsequently “initiate a restructuring of its European operations in earnest.”
The automaker cited “an improving business environment” and “importance of Opel-Vauxhall to GM’s global strategy” as reasons for the decision.
“GM will soon present its restructuring plan to Germany and other governments and hopes for its favorable consideration,” said GM CEO Fritz Henderson. “We understand the complexity and length of this issue has been draining for all involved. However, from the outset, our goal has been to secure the best long term solution for our customers, employee, suppliers, and dealers, which is reflected in the decision reached today. This was deemed to be the most stable and least costly approach for securing Opel/Vauxhall’s long-term future.”
The GM plan entails restructuring expenses of about €3 billion.
“While strained, the business environment in Europe has improved,” Henderson said. “At the same time, GM’s overall financial health and stability have improved significantly over the past few months, giving us confidence that the European business can be successfully restructured. We are grateful for the hard work of the German and other EU governments in navigating this difficult economic period. We’re also appreciative of the effort put forward by Magna and its partners in Russia in trying to reach an equitable agreement.”
