Chevrolet’s pullout from Europe will resolve brand overlap with Opel

Article by Christian A., on December 9, 2013

While General Motors’ decision to withdraw Chevrolet from Europe could be considered as a major setback to its goal of making the brand into a global powerhouse, it allows the US carmaker to put behind a costly strategy of force-feeding Chevys into a market that seemed little interested on those units.

The decision would also terminate a current overlap between Chevrolet and Opel/Vauxhall, in which the US brand has been getting the shorter end of the stick. In fact, Opel/Vauxhall outsells Chevrolet in Europe, six vehicles to one. When GM decided in 2005 to launch Chevrolet in Europe, it could be seen as a contingency plan in case Opel is sold or is on the brink of collapse.

However, Opel is showing a glimmer of light and GM’s decision to drop Chevrolet in Europe seems to affirm what GM executives have been saying for nearly two years – that they will stick with Opel for the long haul. “This lets them focus more on Opel and Vauxhall, while abandoning a brand strategy with Chevrolet that I don’t think many people bought into,” according to Morningstar analyst David Whiston.

GM said in a statement that by 2016, it “will no longer have a mainstream presence in Western and Eastern Europe.” GM, however, will still sell iconic Chevrolets, like the Corvette, throughout most of Europe. Chevrolet will also continue to sell a broad lineup in Russia and other countries like Ukraine, Kazakhstan and Uzbekistan.

On the other hand, Cadillac is “finalizing plans” for expanding its distribution network” in Europe in the next three years in advance of “numerous product introductions,” according to GM. The move “will benefit from a stronger Opel and Vauxhall and further emphasis on Cadillac,” said GM chief executive Dan Akerson in a statement.

Opel chief executive Karl-Thomas Neumann remarked during his presentation at the Automobilwoche Congress in November that Opel and Chevrolet should be further differentiated from each other and be developed separately in Europe. He noted better reach out to their target groups, the Opel and Chevrolet brands should be separated more clearly from one another.

Neumann's remarks echoes the statements made by General Motors CEO Dan Akerson over plans to differentiate the two brands in Europe. Akerson has told Automotive News Europe that he is seemingly frustrated by the "confusing" overlap between Opel and Chevrolet in the continent.

GM has been trying to differentiate the two brands. In fact, GM has been moving Opel upmarket and has been making Chevrolet an entry-level player. Efforts have been proven to be futile though as both brands remains to be seen as similarly positioned, mainstream brands.

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Topics: chevrolet, europe, opel

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