General Motors plans to invest Eu4bn (£3.4bn) in its European brands, Opel and Vauxhall, through 2016 as it adds models to increase market share and restore profit in the region.
Spending will focus on developing 23 vehicles and 13 engines to reach a goal of breaking even in Europe by mid-decade, Chief Executive Officer Dan Akerson said at a press conference today.
The announcement following a meeting of the US company’s board at the Opel division’s headquarters in Ruesselsheim, Germany.
“We’re more convinced than ever Opel will succeed,” Akerson said. “We are also more convinced than ever that GM must have a strong and successful presence throughout Europe, and especially here in Germany.”
GM’s European business, which consists primarily of Opel and its UK equivalent Vauxhall, has accumulated losses of $18 billion since 1999.
Detroit-based GM’s earnings-revival strategy for the region includes the new models, partly in cooperation with French carmaker PSA Peugeot Citroen (UG), as well as spending cuts through measures such as shutting Opel’s car factory in Bochum, Germany.
It is not yet clear what the investment will mean for Vauxhall’s UK plants but further details are expected in the near future.
Opel and Vauxhall vehicles that have entered the market since late last year include the Adam city car, Mokka sport- utility vehicle and Cascada convertible.
The carmaker hired Karl-Thomas Neumann, formerly head of Chinese operations at German carmaker Volkswagen AG (VOW), to become head of the European operations and CEO of Opel in March.
