American automobile giant General Motors is getting nervous with Opel which is registering losses, Reuters reported. According to the same report, GM CEO Dan Akerson is looking at a variety of options as to what to do about the money-losing European Opel division, but that a sale is not a realistic scenario.
“Akerson is fed up with Opel, and the turnaround isn’t gaining traction,” a GM source told Reuters. Sources inside GM also told Reuters that Akerson was once in favor of selling Opel but that the European brand’s operations are too intricately linked with those of GM as a whole.
Auto Bild and Spiegel Online said possible buyers could be Chinese carmakers or Germany’s Volkswagen. The magazines cited no sources.
General Motors declined comment. Opel also declined to comment, but its CEO, Karl-Friedrich Stracke, called the reports “pure speculation” in a letter to employees.
GM executives are frustrated with Opel’s turnaround since GM’s bankruptcy back in 2009. The unit has been losing money every since but is on track to break even this year and return to profitability in 2012.
But the brand’s image has been hurt in Europe, particularly in its domestic market of Germany, and a return to healthy sales is something GM is afraid may not happen – or happen quickly enough.
A more realistic option would be an alliance with another European automaker, as GM Europe once had with Fiat, as a way to share costs and bolster the viability of the Opel brand.
