October 9, 2018 / 4:14 PM / 10 days ago

PSA's Opel to discontinue Adam, Cascada models to focus on SUVs

FRANKFURT, Oct 9 (Reuters) - German carmaker Opel, owned by France’s PSA Group, said on Tuesday it would stop selling the Cascada convertible, the Adam city car and the KARL at the end of 2019, as part of a product overhaul to focus on sport-utility vehicles.

The maker Opel and British Vauxhall branded cars blamed new emissions rules for the cull, but the carmaker has struggled to reach sustainable profitability after racking up more than a decade of losses selling low-margin cars under previous owner General Motors.

“In order to contribute to the CO2 compliance and to focus on high volume segments, the Opel ADAM, KARL and Cascada will not be replaced after the end of their life cycles, but will remain on sale until the end of 2019,” Opel said in a statement.

Carlos Tavares, chief executive at France’s PSA, has demanded steep cost cuts at Opel after he rescued the Peugeot brand from near bankruptcy by cutting lower margin models to focus on more lucrative SUVs.

Opel, which the French carmaker acquired in 2017, is being given the same treatment, and is now seeking to raise the proportion of SUV sales to 40 percent by 2021, from 25 percent today.

A new Opel Mokka X compact SUV will hit showrooms in 2020, Opel said.

Opel will also launch a new Corsa city car and a Vivaro van in 2019. The Corsa will be available as a fully electric car too, Opel said.

EU lawmakers last week backed a plan to cut carbon dioxide emissions from cars and vans by 40 percent by 2030, drawing howls from the car industry which is already struggling to fund investments into electric vehicles. (Reporting by Edward Taylor; Editing by Mark Potter)

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