LONDON (Bloomberg) -- General Motors Co. said it may enter the World Rally Championship for the first time in more than 20 years to bolster the image and selling prices of European brands Opel and Vauxhall.
Success in motor sport would increase the appeal of GM's models to younger buyers after its image was tarnished by a $50 billion government bailout, said Nick Reilly, president of the company's European operations.
“Sport is an important area, and to me, a car company ought to be able to compete,” Reilly said. “It's very significant to us, the brand image, and in our view it's not as strong as the product. We're winning lots of awards but Opel and Vauxhall probably don't command the prices they deserve.”
GM Europe is looking most seriously at touring-car events, in which standard sedans compete on racing circuits and where the U.S.-based Chevrolet unit has just clinched its first world championship, Reilly said. A return to rallying, which takes place on public roads and gravel tracks, would cost more.
Carmakers have been exiting racing in recent years. Subaru and Suzuki Motor Corp. quit the World Rally Championship in 2008 as the slump crimped sales, while Honda Motor Co., BMW AG and Toyota Motor Corp. have withdrawn from Formula One, the world's richest and most-watched motor sport.
No decision has been taken on which events to enter, but the preference is for those featuring cars that customers can buy from the showroom, Reilly said. GM has no interest in F1, which features purpose-built autos not available for purchase.
“I get very excited by touring car racing and I think it's done the Chevrolet brand quite a bit of help in some places,” Reilly said.
GM secured its first World Touring Car Championship last month with a Chevrolet Cruze driven by Yvan Muller. The model also won the 2010 British Touring Car Championship, in which UK-based Vauxhall last entered a company team in 2009.
Opel, based in Ruesselsheim, Germany -- where Reilly said raising prices poses a “big challenge” -- is considering entering that country's touring-car championship, the Deutsche Tourenwagen Masters, spokeswoman Uta Deutsch said.
Competing in the World Rally Championship is “another possibility,” though a more expensive option, Reilly said.
For the past two years the WRC has had only two competing manufacturers, Ford Motor Co. and PSA/Peugeot-Citroen SA. The 2010 championship ended on Nov. 14 with Frenchman Sebastien Loeb lifting the title for the seventh time in a Citroen C4. Finn Jari-Matti Latvala finished second in a Ford Focus.
GM Europe has “a chance” of making money in 2011, excluding reorganization costs, after a loss of about $1.9 billion this year, and the division won't risk extending losses through a premature return to motor sport, Reilly said.