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GM's $5.2 billion commitment to Opel

Wednesday, April 10, 2013 - 01:05

April 10 - General Motors' Chief Executive Dan Akerson assures Opel in Germany of his commitment to bring the automaker back to its former glory. Rough Cut (no reporter narration).

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ROUGH CUT (No reporter narration) (SOUNDBITE) (English) GENERAL MOTORS CHIEF EXECUTIVE, DAN AKERSON, SAYING: "I'm also pleased to announce that General Motors will invest four billion euros in our European operations between now and 2016 and that's so that we can deliver world class vehicles and improve our market share in Europe." "The brand Opel stands for cars with German quality at affordable prices. These Opel cars can be sold outside of Germany, outside of Europe if it makes sense, if we can put the business case together." General Motors renewed a commitment to its loss-making European brand on Wednesday (April 10), pledging to invest 4 billion euros ($5.2 billion) in Opel by the end of 2016 to support new model launches. GM is aiming for a slight improvement in its European business this year, but not enough to avoid a 14th straight annual loss as car sales on the continent plunge to their lowest in almost two decades. Speculation has persisted that GM might shift Opel's assets off its balance sheet into a joint venture with struggling French ally PSA Peugeot Citroen, or even sell Opel entirely. When asked specifically whether the 4 billion euro investment pledge guaranteed that Opel would remain a fully-owned unit of GM through 2016, Akerson declined to comment. But his top lieutenant, Opel Chairman Steve Girsky, told Reuters that speculation of a disposal was unfounded. GM's board met in Ruesselsheim to examine progress in the brand's turnaround plan dubbed "DRIVE!2022" and the difficulties faced by Europe's auto industry. The company's adjusted operating loss in Europe widened to $1.8 billion last year from $700 million in 2011 and it only expects to achieve profitability in the middle of the decade. New product launches should help it meet that goal, with Opel planning 23 new models including the upcoming Cascada cabriolet and 13 new engines.

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GM's $5.2 billion commitment to Opel

Wednesday, April 10, 2013 - 01:05