Opel/Vauxhall is confident it can produce its new Adam minicar in Germany and still make money.
"The way the car has been constructed gives us the possibility to build in Germany and still be profitable," Opel sales and marketing boss Alfred Rieck told Automotive News Europe.
Opel is building the Adam at its factory in Eisenach, Germany, even though most automakers choose to build their small cars in eastern Europe, where wages are lower.
To cut engineering costs, Opel designed the Adam on a shortened version of the Opel Corsa subcompact's platform. The Adam also will share the Corsa's paint shop, body shop and assembly line, thus reducing manufacturing costs.
The two cars will share powertrains, too. The Adam will use the Corsa's 1.2- and 1.4-liter gasoline engines, which will be joined by two versions of a three-cylinder turbocharged 1.0-liter gasoline direct-injection unit this year. The Adam starts arriving in European showrooms this month.
By borrowing engines, technology and manufacturing from the Opel Corsa, company officials hope to prove that it can profitably produce small cars in western Europe.
Rival companies have practically given up trying. Nissan imports the Micra from India, and Mitsubishi will import its subcompact for Europe from Thailand. Recently, Honda announced that its Swindon, UK, assembly plant will stop producing the Honda Fit. And last October, Reuters cited warnings from unnamed union officials that Renault wanted to make 70 percent of its Clios in Turkey.
Targeting the Fiat 500
The Adam will compete in what Opel calls the "premium A segment," which includes cars such as the Fiat 500. At 11,500 euros in Germany, the Adam's starting price mirrors the 500's. Like BMW's Mini, the Adam will offer a wide range of personalized equipment that Opel hopes will tempt customers to spend more.
"It's not cheap transportation necessarily," Opel engineering chief Michael Ableson said in an interview. "We've taken efforts to ensure we can do [the personalization] economically and offer it at a cost."
However, the various options to personalize the Adam do add complexity. On top of 12 body colors, buyers can choose among three roof colors.
Customers can pick colors for the dashboard, steering wheel, door inserts, key fob and rearview mirror frame. And if that isn't enough, customers can opt for a headliner embedded with 63 LEDs. Other options include a built-in bicycle carrier and a smartphone integrator called IntelliLink, which is a 300-euro option that migrates some phone functions including an Opel-designed satellite navigation app to the dashboard screen.
The company says the combinations run past 1 million.
"It's a consumer's dream and a manufacturer's nightmare," said Duncan Aldred, managing director of Vauxhall, Opel's UK-based sister brand. "This takes it to a level the industry hasn't seen before."
To make sure it can handle all this complexity, Opel updated its Eisenach assembly plant, which also builds the Corsa.
"We had to spend a bit of money in the paint shop to do the two-tone roof," Ableson said. "We also put in a facility to handle some of the personalization."
Opel hopes to sell 40,000 to 50,000 Adams a year. Opel is targeting a "younger, urban customer" with the Adam, Ableson says.
The personalization could prove difficult for a company accustomed to supplying cars in standard trim levels aimed at business customers. Said Aldred: "It puts great pressure on the organization, but I think that shows the confidence we have going forward."