General Motors is retreating from more markets outside of the United States and China, saying on Sunday that it will wind down sales, design and engineering operations in Australia and New Zealand and retire the Holden brand by 2021.
GM also said that China's Great Wall Motor had agreed to buy its Thailand manufacturing plant. The automaker said it also plans to pull the Chevrolet brand from Thailand.
The company expects to incur net cash charges of about $300 million in connection with the changes, and total cash and non-cash charges of $1.1 billion.
In rearranging its global operations, GM is accelerating a retreat from unprofitable markets, notably Europe, while becoming more dependent on the United States, China, Latin America and South Korea.
GM Chief Financial Officer Dhivya Suryadevara told analysts during a Feb. 5 presentation that restructuring GM's international operations outside of China so they produce profit margins in the mid-single digits "does represent a $2 billion improvement" compared with 2018.
Ahead of that presentation, GM forecast flat profit for 2020 and reported a better-than-expected fourth-quarter earnings in the face of a $3.6 billion hit from a 40-day United Auto Workers strike.
With the proposed sale of the Thailand plant to Great Wall, GM is giving up an opening to expand operations in Southeast Asia.
GM is "focusing on markets where we have the right strategies to drive robust returns, and prioritizing global investments that will drive growth in the future of mobility," especially in electric and autonomous vehicles, GM Chairman and CEO Mary Barra said in a statement.
“I’ve often said that we will do the right thing, even when it’s hard, and this is one of those times,” Barra added.
Barra has prioritized profit margins over sales volume and a global footprint since taking over in 2014.
In 2017, GM sold its Opel and Vauxhall business units in Europe to PSA Group and exited South Africa and other African markets.
Since then, Barra has decided to pull GM out of Vietnam, Indonesia and India.
In earlier moves, GM withdrew the Chevrolet brand from Europe in 2015 and left Russia the same year.