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GM Beats Q2 Forecast with Nearly $1.2 Bil Net Income

EBIT-adjusted earnings are best for any quarter since 2009 bankruptcy.

by on Jul.23, 2015

General Motors CEO Mary Barra remains upbeat about the coming months despite problems in China.

Despite being hit with a $1.1 billion special charge, General Motors managed to deliver a second-quarter profit of nearly $1.2 billion, or $0.67 a share – its biggest three-month profit since emerging from bankruptcy in July 2009 – with strong demand for its North American trucks helping fuel the strong performance.

Factoring in one-time charges equal to $0.62 a share, GM handily outperformed the Wall Street consensus forecast of $1.08 per share. And the second-quarter numbers compared with the modest $190 million, or $0.11, GM reported for the April-June 2014 numbers.

We Earn Your Trust!

“The first two quarters of the year were strong as we fully capitalized on a robust North American industry and maintained our strength in China, despite the challenging conditions in that market,” GM CEO Mary Barra said in a statement. “We said our goal was to improve our earnings and margins this year, and we are on plan.

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GM’s Barra “More Impatient…More Determined”

CEO lays out strategy for 2015; zero defects, more trucks – but more green cars, as well.

by on Jan.08, 2015

GM CEO Barra, "less patient." than before.

It was a “year of great disappointment, but also a year of great progress,” said General Motors CEO Mary Barra as she summed up her first, tough year on the job and outlined the challenges and goals she is facing for 2015.

The first female CEO of a major global automaker, Barra took on her new role just weeks before GM announced the recall of 2.6 million vehicles equipped with faulty ignition switches now linked to the deaths of at least 42 people. That was clearly apparent in the comments the 53-year-old Barra made, stressing her intent to turn GM into a “zero-defects company.”

Automotive Insight!

On a personal level, the GM CEO said the events of the last year have made her “more impatient and more determined” to deal with a corporate bureaucracy that had, in the past, made it difficult to achieve any real change – and which led to not just the recall crisis of 2014 but the GM bankruptcy five years earlier.

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Opel Plant Closes in Bid to Save GM Europe

Bochum plant victim of desperate turnaround bid.

by on Dec.05, 2014

The Bochum, Germany plant, which produced the Opel Zafira, was closed by Adam Opel.

General Motors has taken a critical step forward in its bid to salvage its money-losing European operations, shuttering an unneeded plant in Bochum, Germany.

The closure of the factory, which once employed as many as 22,000 workers, is central to a bid to reverse 15 years of losses by the Adam Opel subsidiary. At the same time, GM plans to invest 4 billion Euros, or nearly $5 billion into its European business to expand its product portfolio and improve the competitiveness of its remaining factories.

The Last Word!

The maker now says it expects to achieve a break-even at Opel by mid-decade. But that goal has been delayed so long that industry analysts are playing wait-and-see before declaring GM’s latest turnaround strategy a success. (more…)

GM Investing More Than $1 Billion in Plants in Europe, North America

Backing reflects confidence in future products.

by on Nov.24, 2014

General Motors is investing more than $1 billion in to plants in Europe and North America, including $40 million into its plant in Pontiac, Michigan.

General Motors is investing more than $1 billion in plants in Europe and North America to ensure the former achieves its goal of profitability while the latter can handle updates to existing vehicles as well as any new products.

Despite the fact that GM Europe has lost money for 17 years, the automaker plans to invest more than $300 million in Adam Opel’s home base in Rüsselsheim, outside of Frankfurt, Germany.

A Real Performer!

Mary Barra, GM’s chief executive officer, said that a new model will be produced at Opel’s plant in Rüsselsheim by the end of the decade.

“This SUV will be the brand’s second flagship alongside the Insignia,” Barra said. As announced in March, $300 million will be invested in Opel’s Rüsselsheim plant to meet future requirements,” Barra said. (more…)

GM Earnings Beat Expectations

Recall crisis shows little impact.

by on Oct.23, 2014

GM CEO Mary Barra is offering a positive assessment of the maker's third-quarter earnings.

Battered by recalls and facing challenges in markets as diverse as China, Russia and South America, General Motors nonetheless managed to beat expectations with its third-quarter earnings report, though revenues fell short.

The maker delivered net income of $1.4 billion, or 81 cents a share after factoring in one-time special items that had a $300 million, or 16-cent per share, impact on the bottom line. Factoring in those one-time costs, GM would have earned 97 cents a share, up slightly from 96 cents a year earlier – and two cents above the consensus estimate of industry analysts, according to Thomson Reuters.

Keeping Them Accountable!

“Strong global sales and growing margins in North America and China helped GM deliver very solid third quarter results,” GM CEO Mary Barra said in a prepared statement accompanying the July to September earnings results. “Despite industry challenges in Russia and South America, our earnings were on plan as we continue to execute our customer-focused strategy.”

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GM Regains Investment Grade Rating from S&P

Maker gets a much-needed endorsement.

by on Sep.26, 2014

GM CEO Mary Barra on the cover of the latest issue of Mary Barra.

Despite the recall of more nearly 30 million vehicles in the U.S. this year, concerns about subprime lending and a lackluster showing in the stock market, Standard & Poors has given GM a much-needed endorsement, raising the company’s credit rating to investment grade.

The announcement comes at a welcome moment for GM, which has watched its share price slide 20% since the beginning of the year, even while the S&P 500 has gained 20%. It also coincides with a generally positive cover story in Time magazine featuring CEO Mary Barra.

Rated Tops for News!

Despite taking some serious hits in recent months, the ratings agency focused on the positive side, among other things, citing the progress of GM’s European turnaround plan, which could put the company back on a breakeven level after losing money for the past 15 years. S&P also noted the automaker’s healthy cash flow and the limited reputational and market share damage from what has become a record number of recalls.

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Opel Takes Over GM Europe Operations

New change brings focus on entry-level small cars.

by on Jul.22, 2014

GM folded its European operations in the newly branded Opel Group as part of its plans to return to profitability.

General Motors plans to make its European operations profitable are taking shape as the automaker has rebranded its European unit as the Opel Group and a renewed its focus on small, profitable cars.

The re-branding took effect July 1. The new organization is based in Rüsselsheim, Germany, and will also oversee Chevrolet’s operations in Russia and Cadillac in Europe.

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“Today, we are more than just Opel/Vauxhall,” Karl-Thomas Neumann, CEO of the management board of Opel Group, said in a statement. “With the Opel Group, we align our organizational and legal entity structure in Europe with the business operations. (more…)

GM Drops $750 Million on Opel Severance Plans

Maker spending about $165,000 per worker at Bochum plant.

by on Jun.17, 2014

The Bochum, Germany plant, which produced the Opel Zafira, is slated to close by the end of the year.

General Motors has taken a critical step in the restructuring of Opel by agreeing to spend $750 million on severance and retirement packages for 3,300 members of the IG Metal, the German metalworkers union.

Opel sits at the heart of GM Europe and the restructuring is necessary to end a string of losses that reaches all the way back to the late 1990s, GM officials said. GM Europe is expected to lose money again this year, but could finally post a profit in 2015.

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Representatives of Opel and IG Metall have negotiated an agreement for the approximately 3,300 employees at a plant in Bochum, Germany, which is due to shutdown permanently by the end of the year. (more…)

GM Revenue Up Slightly for Q4, Full Year

Maker paying profit sharing up $7,500 to hourly employees.

by on Feb.06, 2014

General Motors Co. (NYSE: GM) today reported 2013 calendar-year net income of $3.8 billion, or $2.38 per fully-diluted share.

While its revenue for the quarter and the year rose, General Motors reported its fourth-quarter earnings were flat and full-year earnings were down on a year-over-year basis due to special charges related to some of the company’s restructuring actions.

However, the company’s positive performance in North America buoyed its quarter and year and resulted in its eligible hourly employees expected to received profit sharing checks up to $7,500 each.

Performance Matters!

“Launches of some of the best vehicles in our history combined with significant improvements in our core business led to a solid year,” said GM CEO Mary Barra. “The tough decisions made during the year will further strengthen our operations. We’re now in execution mode and our sole focus will be on delivering results on a global basis.” (more…)

Barra’s German Trip Cements Opel’s Future

New product for Ruesselsheim reflects GM’s commitment.

by on Jan.27, 2014

GM CEO Mary Barra traveled to Germany and confirmed the maker's commitment to Adam Opel.

General Motors’ new chief Mary Barra is spending the early part of her tenure reassuring the company’s European subsidiary, Adam Opel AG, that the U.S. maker is committed to Opel’s success.

Barra traveled to Opel’s headquarters in Ruesselsheim, Germany, to confirm that the company is committed to bringing the company back to profitability by the middle of this decade. Opel has been operating in the red since 1999, leading a number of key analysts to suggest that GM consider divesting itself of the subsidiary.

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“I thought it was very important to reinforce in person my commitment and GM’s commitment to Opel,” she said, according to the Associated Press. She called Opel “clearly a vital part of our company.” (more…)