Opel may love autos but it isn't getting much love from parent GM.
General Motors Corp.’s year-end financial report is expected to show some very good numbers. The exception is Europe where the company’s chronic problems with its German-based Opel subsidiary remain unresolved and losses could exceed $1 billion — just as they did in 2010.
GM chairman Dan Ackerson flatly stated last summer Opel is not for sale. He also dispatched GM vice chairman Steve Girsky, perhaps his most trusted lieutenant, to Germany to fix Opel. And the one-time auto analyst has been busy shaking things up.
Girsky’s latest move has been to completely shake up Opel’s supervisory board which, under Germany unique corporate governance system, is responsible for hiring and firing the executives on Opel’s board of management.
As of this month, the management side of the Opel’s board of supervisors now includes a number of GM executives, including GM’s product development chief Mary Barra, who replaces, Walter Borst, a long time Opel executive and a familiar face around Russelsheim. Also getting seats on the board are Tim Lee, the head of GM’s International Operations, and GM chief financial officer Dan Ammann.
But the shake-up could continue. IG Metal, the big German metalworker’s union, has apparently nominated Bob King, the president of the United Auto Workers, for one of the handful of labor seats on the Opel supervisory board. King has declined to say whether he’ll accept the nomination.
Girsky is hoping the UAW chief can explain the benefit that might flow from the restructuring but it’s probably a tough sell. Reports are circulating that GM is considering closing at least two Opel plants, one in England and one in Germany.
However, a German news magazine noted Opel’s works council, which represents workers within the company, recently issued a statement saying that it had heard nothing about approaching cuts or factory closures. The statement noted that existing contracts prohibit layoffs and closures through 2014.
GM Opel/Vauxhall CEO and General Motors Europe President Karl-Friedrich Stracke meanwhile announced another change to the Adam Opel AG Management Board.
The Supervisory Board appointed Dr. Thomas Sedran, 47, to lead the newly created Management Board position of Operations, Business Development and Corporate Strategies, effective April 1. He is also named Opel/Vauxhall Vice President for that function.
“I am looking forward to working with Thomas Sedran. He is a proven automotive expert who knows Opel/Vauxhall very well. He will be a key player as we develop profitable growth strategies for Europe and for export sales as well as collaboration and partnering strategies in the industry.”
Sedran has spent most of his career as a consultant at companies including Roland Berger and AlixPartners in Southfield, Mi.
His focus on strategy could be critical – as it has been an issue for Opel and GM for some time.
Opel had always considered itself GM’s “overseas” brand, the marque that carried the GM flag to countries around the world. But the rise of GM in China and South Korea, and the company’s efforts to build Chevrolet into a global brand have scrambled old assumptions. The shift has limited Opel’s opportunities in China, Korea and South America. GM also is promoting Chevrolet in Russia and even in Central Europe where Opel was thought to have first claim on potential buyers.
As it is, GM announced plans to sell an Opel version of Volt in Europe, dubbed the Opel Ampera, but that has been delayed. For now, GM is selling the Chevrolet version of Volt in part of Europe as well. The picture is further complicated because Opel’s traditional competitors, such as Volkswagen continue to add capacity.
After losing something like $14 billion on Opel since 1999, GM remains deeply conflicted about the operation’s future. The company clearly needs to staunch the ongoing losses and GM seems more committed than ever to turn Chevy, rather than Opel, into a global brand.
On the other hand, GM executives insist they don’t want to lose the engineering, design and manufacturing talent embedded in the Opel organization. The desire to keep Opel in the GM family was one of the reasons a 2009 deal to sell Opel to the Canadian supplier Magna International and Russian investors, which had been sanction by the German government, ultimately fell apart.
To explain the situation, GM and the Opel Supervisory Board has named PR veteran Johan Willems as an Opel Management Board member in charge of Communications. In his role as the new head of Opel/Vauxhall Communications, he succeeds Dr. Susanne Wegerhoff who has elected to leave the company. In this position, Willems, who is currently Vice President, Communications, for GM International Operations based in Shanghai, China, will be responsible for all Product, Brand, Corporate and Internal Communications at Opel/Vauxhall in Europe.
“This new appointment complements and further strengthens the Management Board and the company overall. Both, shareholder representatives and employee representatives on the Supervisory Board are in agreement that Opel has to become profitable, even in times of tough economic headwinds,” Girsky and Wolfgang Schäfer-Klug, the senior representative of Opel employees on the supervisory board observed in an unusual statement issued jointly after Willems’ appointment.
“The parties are jointly discussing the strategy and will keep employees and the public informed. Thanks to its excellent model range with six new product launches in 2012, Opel/Vauxhall is confident that it can build on its success in the marketplace,” the statement added.