After Karl-Friedrich Stracke’s departure as Opel CEO, the European automaker said that it will create a new business plan for the mid-term. General Motors, the parent of Opel, had decided to replace Stracke with GM Vice Chairman Stephen Girsky who now serves as interim CEO. An Opel spokesman said that the change in leadership doesn’t signify any difference to how committed Opel is to its revitalization plan.
He also said that Opel is a “cornerstone” for the operations of GM worldwide and that GM is fully supportive of its present plan to give Opel a boost and become more competitive.
Since three years ago when GM had exited from bankruptcy, Opel has incurred $3.5 billion in operating losses because of a declining European car market and a bloated fixed-cost base.
According to analysts, it’s likely that Girsky would have to take more drastic methods to cut losses due to the impatience that GM feels for Opel’s restructuring. Stracke was replaced just weeks after progress was made in establishing the foundations for a turnaround.
German unions chose to enter talks with Opel as long as there won’t be any compulsory layoffs through 2016. What the automaker gets in return are wage concessions and approval to close down the Bochum, Germany plant.
Recently, the European arm of GM said that about half of its investments through 2016 would be built in Germany, implying that the company has no plans to get rid of staff there. Approximately half of Opel's workforce is employed in Germany. Furthermore, Opel had held out the likelihood of building Chevrolets in Opel's European manufacturing plants to boost profitability and protect jobs.