What is in this article?:
- GMâ€™s Opel Plan Now May Include Entry-Level Push
- Signs of Progress
As recently as last year, the plan was to push Opel up-market as a more expensive alternative to the value-oriented Chevrolet brand. But in December GM chose to pull the plug on Chevrolet in the region.
GM President and Opel Chairman Dan Ammann, right, with Opel CEO Karl-Thomas Neumann at Geneva auto show.
GENEVA –soon may begin selling inexpensive, entry-level Opel models in Europe, a shift in strategy aimed at resuscitating a struggling brand that has failed in a bid to move up-market.
“If we see a customer need we are able to meet within the bandwidth of the Opel brand in a particular segment, we will move on it,” GM President and Opel Chairman Dan Ammann tells journalists during an interview here.
“We’re prepared to respond to where the market wants us to go,” he says.
Tina Mueller, Opel’s new marketing chief in Europe, echoes those sentiments, saying the brand lacks focus in the sub-€10,000 ($14,000) segment. Its least expensive model, the 1-year-old Opel Adam city car, sells for anywhere between €12,000 and €16,000 ($16,000-$22,000).
“We see a need below €10,000, because we know for the younger generation (cars) are less and less affordable,” Mueller says.
Playing at the low end of the market would be a shift in strategy for Opel. As recently as last year, the plan was to push the brand up-market as a more expensive alternative to the value-oriented Chevrolet marque. But in December GM chose to pull the plug on Chevrolet as a mainstream brand in the region, an uneven rollout dating back to 2005.
“It creates more breathing space for Opel,” Ammann says. “It creates more clarity, more simplicity, and as part of that you end up with some bandwidth within which to operate.”
The greater bandwidth, however, does not mean Opel will pursue the luxury end of the business anytime soon to compete against top names Mercedes,and Audi.
Opel’s most expensive model, the Insignia D-car, starts at about €25,000 ($35,000).
“Opel needs to be a democratic brand,” says Mueller, 45, a native German who joined the automaker Aug. 1 from the consumer products and auto-parts supplier Henkel.
“Given the recent history of Opel, we need to concentrate on our core segments, which are small, midsize and compact (vehicles) before we enter into luxury. I’m a fan of doing your homework first and getting the brand back, because today (Opel) would not support abuyer. It is too early.”
For many years, Opel andslugged it out as the populist brand in Germany and other European markets. But 14 years of financial losses put Opel’s product offerings on the ropes. Last year, the brand sold 738,411 units in Europe, according to WardsAuto data. Volkswagen delivered 2.1 million.
To stop the slide, GM will invest €4.0 billion ($5.2 billion) over three years in Opel and its U.K. sister brand Vauxhall. The outlay will produce 23 new products and 13 fresh powertrains, including at the auto show here an Adam Rocks version of the Opel Adam with a new 1.0L turbocharged 3-cyl. engine and 6-speed manual transmission, giving the small car a more competitive powertrain in the segment.
Opel also shows an even racier Adam S and the high-performance Opel Astra OPC Extreme C-car with a next-generation 1.6L CDTI diesel engine. In addition, Opel reveals plans to launch OnStar connectivity in Europe next year with 4G LTE high-speed wireless Internet connectivity.