GM’s Opel division returns to Shanghai Auto Show after 5 years

Brian Sin - Apr 20, 2013
GM’s Opel division returns to Shanghai Auto Show after 5 years

After a 5 year absence, General Motor’s Opel division will be returning to the Shanghai Auto Show this year to debut 3 new cars. It hopes to bring its cars to more markets aside from Europe, in hopes of revitalizing its finances. Opel has been on the decline since 1999, losing about $18 billion in total with 10% of that figure being lost last year alone. By bringing its inventory to the world’s largest market, China, it hopes to turn its financial luck around.

The new CEO of Opel and a former executive at Volkswagen, Karl-Thomas Neumann, has said time and time again that China is the market where Opel needs to expand next. However, while it plans on showing off three new vehicles, the Insignia ST, Astra GTC, and the Zafira Tourer, at the auto show, these vehicles aren’t the type of vehicles that would bring Opel massive success in China.

Neumann, who was once ambitious about bringing Opel to China and making it a big name has said that it would cost millions of euros to do so, and that at the moment, “We have other priorities.” The models that Opel is set to debut at the Shanghai Auto Show will also be facing tough competition from GM’s other brands, Buick and GM’s U.S. brand, who already have similar vehicles in China that resemble the Insignia ST, Astra GTC, and Zafira Tourer.

In 2012, Opel only sold 4,500 cars all throughout China. Juergen Pieper, an analyst at Metzler Bank, told Reuters that Opel’s return to the Shanghai Auto Show won’t do anything for profits, but it is at at least a start for the company. Pieper also said that Chinese car buyers “favor German brands so there is a chance that it could take advantage of that to grow over the next year or so.” Unfortunately, Opel has some tough competition from GM’s other brand, Buick, which is currently more favorable in China. Despite its downward slope, GM wants Opel to be successful, and is planning on investing 4 billion euros into the company through 2016 to see it succeed.

[via Reuters]

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