Top of the to-do list for new General Motors Europe (GME) president Nick Reilly is a new small city car.
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He said: “I see gaps which need to be filled. Opel needs a mini; that will be our top priority. I want to clarify that we will also need to continue with light commercial vehicles, that is a reasonable share of our business.”
Speaking during a telephone conference at the weekend, he confirmed that the new Opel/Vauxhall Ampera extended range electric vehicle would be manufactured in Europe with the Astra plant at Ellesmere Port in the UK “one of the candidates, but there are others”.
He added: “We can take advantage of global technology and look at introducing hybrids. Ampera will be manufactured in Europe. Initially, the car will be imported from the US, but long-term, we are looking for a local source. Also, we will look at battery technology. Electric vehicles will increase the focus on that.”
The future of Opel’s Antwerp plant in Belgium was less clear.
Reilly said: “Until we finalise our discussions, we won’t make any comments. We will, and are, looking for alternatives. But bear in mind, we must reduce capacity and we must reduce structural costs. We had plans and an agreement in place but some plans can’t come true in view of the changing business environment. You see in the US how many plants had to be shut down – and there were probably product plans for each one of them. To be sustainable, we must reduce capacity.”
Reilly was president of GM’s international operations based in Shanghai until last week when he was appointed president of GME. He has also previously headed Vauxhall here in the UK.
He said: “There will be two organisations in Europe: Opel/Vauxhall and Chevrolet Europe. I will be accountable for both, run Opel/Vauxhall while Wayne Brannon will continue to be in charge of Chevrolet Europe and I will be CEO of Opel/Vauxhall.”
One of Reilly’s first tasks was to meet with the EU in Brussels last Friday to discuss financing for the European operations.
He said: “It was a positive meeting. We need EUR3.3bn (US$5bn) in total of which EUR1bn ($1.5bn) is for restructuring.
“The rest primarily will be for investments in new products. We expect to lose money in 2010, so we will need some support to get through next year. I am not sure when a decision will be made, but I’ve been getting positive responses.
“There is a belief out there that GM has sufficient money in the US that it can spend in Europe. That is not the case. Much of that money will be needed for Delphi and completing restructuring in the US. We also have some of that money in an escrow account for disasters in the US and we can’t touch that.
“Third, the US market remains depressed and we have to have some money to get us through 2011. We also need to pay back loans to the US government. Finally the money is US taxpayer money. We can use some of it outside of the US but not all.
“We’ve prepared an application for the German government. They were willing to support Magna deal, so we expect some support for our plan. Financial aid is no different from other car companies in the US or Japan or other European countries. I am optimistic they will come forth with aid … but regardless, the German government decision will not lead to more or fewer lay-offs in Germany. The expectation is that we will get financial support from most European governments. We would be disappointed if Germany is the only country which does not participate.”
Reilly also said that no export restrictions had been placed on Opel.
“Opel has no restrictions for exporting. It already has a small but loyal business in China. It attempted to sell in India, but didn’t build the necessary reputation, was losing money and pulled out. Same with Japan. The key is, if a good brand can make money, what would stop us from exporting?
“We will look at opportunities market by market. If it requires building the brand, that is very difficult to do. We will not enter into an export programme just to add volume. We must be able to make money; otherwise we won’t do it.”
