GM Investing 4B Euros in Opel, Keeping Brand Alive

GM Investing 4B Euros in Opel, Keeping Brand Alive

Should General Motors’ German subsidiary be scrapped? Not according to its American parent, which plans to pour four billion Euros into it through 2016.

European car sales are limping along, down an estimated eight percent in 2012 compared to the year before. Opel’s story is even more dysmal: estimated new registrations dropped 16 percent in 2012 compared to 2011. February registrations were 15 percent below the same month last year. Regardless, GM seems steadfast in its support of the brand.

“As a global automotive company GM needs a strong presence in Europe – in terms of design and development as well as manufacturing and sales,” said Dan Akerson, Chairman and CEO of GM, at a press briefing at Adam Opel Haus. “Opel is a key to our success and enjoys its parent company’s full support.”

But success for Opel means more than keeping General Motors footed in Europe. It means continued support for Buick – arguably GM’s weakest North American brand. Despite outselling Cadillac last year, the Buick line isn’t attracting the same attention.

Investing 4 billion euros – $5.23 billion by today’s rates – means the brand will stay alive. Buick currently shares all of its five vehicles except the Enclave SUV with Opel. That could mean a brighter future for GM’s entry-level luxury marque.

[Source: AutoNews]