General Motors European Opel arm is shaking up operations in Russia to combat difficult market conditions which are “facing serious turbulence”.
Opel management board chairman Karl-Thomas Neumann, said: “While we believe in the long term potential of Russia, there is significant immediate pressure on sales volumes and pricing while the rouble is deteriorating further. Since this is impacting our Opel Group business results, and will continue to for the remainder of the year, we are taking measures now to limit our risk and stay on course.”
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Operations will be realigned as Susanna Webber, Opel’s head of purchasing and supply chain, immediately becomes president and managing director of GM Russia. Supplier localisation will be rapidly increased to better serve Opel’s St. Petersburg plant where production volumes will be reduced by moving back to a one-shift operation. The company said it would offer packages to enable voluntary employee redundancies.
Andy Dunstan, managing director of Russia since November 2013, remains in Russia and has become vice president of sales and aftersales.
Neumann said: “We are monitoring the market development in Russia very closely and adjusting our expansion plans. We remain committed to our investments in the GM-AVTOVAZ joint venture where we are preparing the launch of the next generation Chevrolet Niva in 2016.
“New press and body shops and a new logistics centre are part of the investment in the Samara region.”
GM’s European operations took over responsibility for the business in Russia in January this year from GM International Operations. In the first eight months of 2014, new vehicle registrations in Russia have declined 12.1%.
GM brands in Russia are Opel, Chevrolet and Cadillac and their combined market share was about 7.8% from January to August, down from 9% in the same period a year ago. St Petersburg currently builds the Opel Astra and the Chevrolet Cruze. Other Opel, Chevrolet and Cadillac vehicles are produced with partners Avtotor in Kaliningrad and GAZ in Nizhniy Novgorod. The Chevrolet Niva is produced at GM-AVTOVAZ in Togliatti.
