General Motors Europe is gunning for profit ahead of unit volume growth in what is expected to be a largely flat car market in 2007, GM Europe president Carl-Peter Forster has said.
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“The most important target for us is to be better in terms of profitability,” Forster told reporters at the Detroit motor show, adding: “Honestly, volume is almost a secondary objective.”
Marketing and sales chief Jonathan Browning told the news agency that GM Europe improved revenue per unit sold by more than $US700 (GBP362) last year based on sales of the Opel, Vauxhall and Saab brands and did this by cutting back on low-margin fleet sales, rolling out new models and improving content.
The average transaction price for a three-door Astra GTC compact, for instance, was EUR5,000 higher than for its predecessor, Forster reportedly said.
GM Europe’s unit sales rose by around 19,000 units last year to pass 2m vehicles for the first time, Browning told Reuters, noting that the overall European market gained around 3% last year, with Russia and Ukraine accounting for 70% of the growth.
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By GlobalDataHe reportedly foresaw a patchy European market in 2007.
“We see Russia and Ukraine continuing very strongly. We think Poland will come back a bit after its pretty low level these past two years. Turkey lost around 100,000 units in 2006, we think that will come back a bit,” he told the news agency.
In western Europe, France and Britain will likely contract this year, but Germany remained hard to predict, the GM executive reportedly said.
“Germany is really the big question mark. Will we see business confidence translating into consumer confidence translating into purchases of cars? That’s really the key open question,” Browning said, according to Reuters.
