* Management, labor approve plan through 2016
* No concrete forecast given for Opel's profitability
* GM sees strong future for Opel -GM vice chairman
By Christiaan Hetzner and Ben Klayman
FRANKFURT/CHICAGO, June 28 Opel, the ailing
European arm of General Motors Co, took a key step toward
returning the brand to long-term profitability after its
supervisory board voted in favor of a midterm business plan that
included "massive" investments in its model range.
"The plan approved today paves the way for a strong future
for Opel. GM stands behind Opel and supports management and
labour," said GM Vice Chairman Stephen Girsky in a statement on
Girsky chairs Opel's board, which is split evenly between
representatives from GM and elected delegates from the
40,000-plus workers at Opel and its UK sister brand, Vauxhall.
The business plan for the four years through the end of 2016
entails "massive" investments in the product range, a redesigned
brand strategy, an increase in exports, cuts in material,
engineering and development costs as well as added savings from
its alliance with France's Peugeot Citroen.
No concrete details were provided, nor did Opel say when it
expected to return to the black, however. Its underlying
operating loss narrowed last year to $747 million from $1.95
billion in 2010.
GM Chief Executive Dan Akerson said at an event in Chicago
on Thursday that it was premature to say how soon the U.S.
automaker could get its European operations back to
profitability. But he added, "if you look out five years, I
would be disappointed if we couldn't get to profitability."
Speaking to an audience of business executives, Akerson said
he was "cautiously optimistic" about the progress in Europe,
where GM remains committed to Opel.
"We've lost $14 billion in the last 12 years. It's got to
stop," he said of Europe. "We're looking at some sort of
agreement with our unions that would allow us to consolidate."
Akerson wants to stem the constant flow of red ink at Opel
by shrinking its fixed-cost base and running each plant at
maximum capacity on a three-shift basis - something analysts say
is possible only if he closes at least one of the six car
Akerson said Thursday that GM had not formulated any charges
to restructure the money-losing European unit, but would provide
more details once a definitive deal with union workers is
"The support of GM shows just how important European
engineering and the European sites of Opel and Vauxhall are for
the group," said Opel's top labor leader, Wolfgang
Strident union opposition to plant closures has forced Opel
to take a two-track approach to its restructuring - putting the
plan to a boardroom vote while negotiating separately over staff
cuts in Germany that likely would take effect only after the
last year of the plan.