Tags: GM | Opel | China | Europe

GM to End Opel's Two-Decade China Effort to Focus on Europe

Friday, 28 Mar 2014 06:23 AM

General Motors Co. will pull Opel from China next year after more than two decades as part of a plan to focus the brand on the European market.

Opel, which has been in China since 1993, failed to expand beyond a low-volume, niche player in the country, accounting for less than 1 percent of GM’s sales in the market last year. Opel’s 22 Chinese dealers sold 4,365 vehicles in 2013.

“This is a long overdue decision,” Karl-Thomas Neumann, Opel’s chief, said in a statement today. “It would have cost hundreds of millions of euros to raise awareness of the Opel brand and to expand the distribution network.”

GM, which in 2013 was outsold by Volkswagen AG in China for the first time in nine years, has been reorganizing its brands worldwide. In December, the Detroit-based carmaker said it would pull Chevrolet out of Europe and that its Holden unit would stop manufacturing cars in Australia.

“Opel’s sales volume in China is limited,” said Zhang Xin, a Beijing-based analyst with Guotai Junan Securities Co. “Still, it is not simply a China matter as retreating from such a high growth market like China may affect the brand’s global operation and image.”

GM, which sells more vehicles in China than any other country, has said that the company and its joint ventures plan to invest $11 billion through 2016 in the world’s biggest auto market on new plants, people and products.

A sale of Opel to Canadian auto-parts producer Magna International Inc. and Russian partner OAO Sberbank was among options that GM considered as the company struggled to restore group profitability during the global recession in 2009. GM, which has controlled Opel since 1929, chose instead to keep the business and reorganize it, and executives have vowed to make it profitable by mid-decade.

© Copyright 2017 Bloomberg News. All rights reserved.

 
1Like our page
2Share
Companies
General Motors Co. will pull Opel from China next year after more than two decades as part of a plan to focus the brand on the European market.
GM,Opel,China,Europe
300
2014-23-28
Friday, 28 Mar 2014 06:23 AM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved