After six years of losses, General Motors Europe’s Opel volume brand is on the brink of breaking even in 2005. Now Carl-Peter Forster, one of the chief architects of the turnaround, will now try to push GM Europe into the black as chairman of the division, Automotive News Europe reported.
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Company and dealer sources said GM Europe has halved its EUR742m loss of a year ago. And Opel will come close to breakeven this year.
“It’s pretty obvious we are on a positive track,” Forster told the newspaper. “When exactly we will cross the line, I can’t tell you. But it’s pretty obvious that after many years of losses this is not in the too-distant future.”
He made the remarks after being named to succeed Frederick “Fritz” Henderson in Europe, who becomes GM’s new chief financial officer.
Last year, Forster helped implement a massive restructuring plan that included 12,000 job cuts, including 10,000 positions in Germany. GM was determined to make its European operations profitable and Forster, Opel’s former chairman, played a key role in the process.
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By GlobalDataGM’s European operations have not made money since 1999. This year GM Europe expects to lose between EUR300-400m, insiders say. Opel accounts for nearly 80% of GME revenue, with the balance from UK sister brand Vauxhall and premium brand Saab. GM no longer separates Opel’s financial results from those of GM Europe.
“Some of the restructuring we did in the German market is paying off,” Forster said. “Initially, it looked almost impossible to do. We somehow pulled it off.”
Forster, 51, a former BMW executive and a self-described product guy, is doing it with product.
Through October, Opel sales are up 1.4% in western Europe. Sales of the Astra, the first vehicle with Forster’s direct influence, have increased 35% versus the year-ago period. GM sales are up 10.2% in western Europe and market share has increased to 10.6% from 9.6 share points last year, its highest level in five years.
Industry experts say Forster has also made improvements in product development, supplier relations and productivity.
