Restructuring specialist to be interim CEO of GM's Opel
FRANKFURT (Reuters) - U.S. carmaker General Motors (GM.N) appointed Thomas Sedran, a restructuring specialist, as interim chief executive of Opel, and said it would redouble efforts to return the ailing European brand to profitability.
Sedran only officially received the title of deputy CEO, however, and unlike predecessor Karl-Friedrich Stracke he was not named president of GM Europe - a title that went to GM vice chairman Stephen Girsky, suggesting more control will be returned to headquarters in Detroit.
Fixing Opel, which trades as Vauxhall in Britain, has become a top priority for GM chief executive Dan Akerson, who has demanded an end to the $3.5 billion in underlying losses racked up after the U.S. parent emerged from bankruptcy in 2009. GM lost an additional $256 million in the first quarter.
"We will continue to implement our business plan as it was outlined and work to improve it," Girsky said in a statement, indicating Stracke's recent plans to return the company to profit may not have been ambitious enough.
An engineer and product whiz rather than a restructuring expert, Stracke was fired as GM Europe President and Opel CEO last Thursday in a move so abrupt board members were caught off guard.
Although it may appease investors on Wall Street demanding quick results, observers in Germany have criticized the timing of Stracke's sacking as short-sighted.
Since deciding in early November 2009 against the sale of a majority stake in Opel, GM has replaced its European president three times and is currently planning its second round of restructuring including the closure of a plant in Bochum, Germany.
Opel said Sedran, who joined in April as head of operations, business development and corporate strategy, would assume day-to-day responsibility until the search for a permanent successor to Stracke was completed.
While company sources said Sedran would be a strong candidate for the position of Opel CEO, analysts said his interim nomination was evidence his leeway to operate could be quite limited given the growing influence of Girsky.
Opel labor leader Wolfgang Schaefer-Klug underlined Girsky's importance in a statement, without mentioning Sedran by name. "The new team around Steve Girsky stands for a change that Opel and Vauxhall urgently needs: leaner management structures, transparency, accountability and enforcement capability."
Juergen Pieper of Metzler Bank said Girsky, as the new GM Europe president, was likely the de facto head of Opel but could not officially assume the position for legal reasons.
German law prohibits the chairman of a supervisory board, who plays a key governance and oversight role, from simultaneously running a company as CEO, as is common in the United States.
One labor source said Sedran was being groomed for the post, suggesting he may be more than just a stopgap. Former CEO Nick Reilly ran the company initially as interim chief for three weeks before taking over permanently in December 2009.
Sedran's biggest challenge will be rehabilitating Opel's image in Germany, where its market share has dwindled to record lows, making the brand more and more dependent on struggling southern European markets such as Italy and Spain.
Whereas Western European new car registrations fell 7 percent in the first half, according auto industry association ACEA, demand for Opels and Vauxhalls tumbled over 15 percent much like other southern European brands such as Fiat (FIA.MI), Seat (VOWG_p.DE) and Renault (RENA.PA).
One hope is Opel's plan to join efforts with French peer PSA Peugeot Citroen (PEUP.PA). GM and PSA agreed in February an alliance expected to reap combined synergies of about $2 billion annually within about five years.
It was unclear what role Sedran will play in the alliance, and spokespeople for the company could not say on Tuesday whether Sedran would inherit Stracke's seat on the 10-person Alliance Steering Committee.
Metzler's Pieper said the head of the European car parts suppliers association CLEPA, Jean-Marc Gales, could be a strong external candidate to replace Stracke.
The Luxembourg native speaks fluent French and German and knows both companies intimately, having worked as Opel sales chief and most recently as head of both the Peugeot and Citroen brands.
"He has made a name for himself, he is ambitious and has experience managing amid difficult conditions like at PSA. It is quite likely that he is a candidate," said Pieper, adding ex-Daimler restructuring specialist Rainer Schmueckle was another.
(Additional reporting by Ben Klayman; Editing by Erica Billingham and Dan Lalor)
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