GENEVA -- General Motors Co.'s Opel subsidiary, the core of GM's money-losing European unit, foresees an operating profit this year, its top executive says.
"Our internal target is to be profitable this year before restructuring charges," said Nick Reilly, president of GM Europe. "That lays the foundation for next year to turn a decent, good profit again, which has been some time for Opel to do."
GM Europe, which includes Opel of Germany and Vauxhall of England, was GM's only unprofitable division in 2010. Black ink from Opel would be key to GM Europe's recovery.
GM lost $1.76 billion in Europe in 2010. GM has said that it expects GM Europe to break even this year, before restructuring costs.
Speaking at a media roundtable at the Geneva auto show last week, Reilly said GM Europe's plans to cut staff by about 8,000 are proceeding. But he said the net reduction will be less because GM Europe will hire 500 engineers and product development staff members in 2010-11.
Reilly also said Opel will pump up its exports. It sends vehicles to Israel, South Africa and Chile. It is preparing vehicles for export to Australia, China, Argentina and places in the Middle East besides Israel, he said.
Although Opel probably will only export 40,000 to 50,000 vehicles this year, Reilly said it could hit the 100,000 mark in three or four years.
"Then we see where we go from there," he said. "If we're successful, we may expand to other countries. If we're really successful, we may even think of local manufacturing, but we're not that far yet."
Reilly said Opel's previous export drives were unprofitable because they focused on low-priced, high-volume vehicles. Said Reilly: "We're doing it only if we can make money this time around." c