Akerson tells Opel workers GM won't abandon Europe
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Akerson says Opel is important to GM. |
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FRANKFURT (Reuters) -- General Motors Co. will neither sell its money-losing Opel/Vauxhall unit nor "simply close up shop and leave," CEO Dan Akerson told more than 5,000 staff in the brand's headquarters in Ruesselsheim, Germany.
"Our protracted losses have even prompted some analysts to argue that we should sell Opel or simply close up shop and leave car sales in the region to others -- I'm not about to do that," he said in a speech on Thursday.
"As a global auto company, GM needs a strong design, engineering, manufacturing and sales presence in Europe. There's room for Chevrolet in Europe but Opel fulfills that role," Akerson said.
He added: "Recommendations that we 'cut and run' show you that some people simply do not see how important Opel is to our success."
Other senior executives have defended Opel's role within GM, but this is the first time that Akerson has sworn loyalty in front of the work force. Akerson made it clear that the 23 new models and model replacements entering the market by the end of 2016 were proof that GM was committed to helping its European brand.
"If our intention was to simply declare Opel bankrupt, or let it drift until the economy rebounds, we wouldn't be wasting our time and money with these investments," he said.
Akerson's pledges of loyalty in English were projected on a screen with German subtitles. He spoke alongside GM Vice Chairman Steve Girsky, who also heads GM's European operations
Global expertise
Akerson said Opel and the ITDC engineering and development center at Ruesselsheim play a key role in GM's global product development plans, and Opel's expertise in CO2 reduction and other technologies have value around the world.
Akerson has come under pressure from investors to divest or unwind Opel, which Morgan Stanley forecasts will post another $1 billion in annual operating losses on average through 2021 after $16 billion over the past dozen years.
Analysts believed Akerson was open to a radical approach given his minority view to sell Opel to Magna International late in 2009.
GM expects a full-year operating loss of $1.5 billion to $1.8 billion in Europe this year, depending on the amount of restructuring in the fourth quarter.
GM lost $747 million in the region last year and is targeting results in Europe to be slightly better in 2013 than in 2012 and to reach break-even levels by mid-decade.
Akerson said GM planned to grow and not shrink Opel as unions feared. He only briefly mentioned GM's alliance partner PSA/Peugeot-Citroen. "The fact is we lack economies of scale in critical areas and if we can achieve scale by partnering with PSA, that's what we are going to do," he said.
Earlier this week, GM said its partnership talks with PSA are on track despite reports that GM and PSA had shelved talks on a deeper tie-up amid misgivings about PSA's worsening finances and a French government-backed bailout of the French carmaker's finance arm.
Positive reaction
One Opel employee who attended the event said the general reaction was largely positive. "I wouldn't call it thunderous, but there was applause. Some might still be cynical but overall it was seen as a clear commitment to Opel and the important role it plays within GM -- I don't think it was interpreted as Akerson playing some tactical game."
Automotive News staff and wire services contributed to this report
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