General Motors Europe
|Former type||Subsidiary of
|Founded||April 4, 1986|
|Number of locations||14 manufacturing facilities in nine countries|
|Key people||Nick Reilly, CEO|
General Motors Europe (often abbreviated to GM Europe) was responsible for the operation of General Motors ("GM") businesses in Europe. The subsidiary was established by GM in 1986 and operated 14 production and assembly facilities in 9 countries, and employed around 54,500 people. GM's core European brands are Germany-based Opel and UK-based Vauxhall, which sell much the same range of cars in different markets. It formerly owned the Swedish marque Saab until early 2010. The U.S. brands Corvette and Cadillac are imported into Europe in small quantities. In 2009, General Motors (GM) announced to move its European headquarters from Zurich, Switzerland to Rüsselsheim, Germany to strengthen its German subsidiary Opel.
In Europe, GM Europe operated 14 vehicle production and assembly facilities in nine countries and employed around 54,500* people. Many additional directly related jobs were provided by some 8,700 independent sales and service outlets. In 2005 GM's market share in Europe was 9.4%.
- Germany: Bochum, Eisenach, Kaiserslautern and Rüsselsheim, employed 25,103 workers.
- Spain: Figueruelas, Zaragoza, employed 7,001 workers, being the biggest of General Motors in Europe.
- UK: Ellesmere Port and Luton, employed 4,279 workers.
- Sweden: Trollhattan, employed 3,892 workers.
- Hungary: Szentgotthárd, employed X,XXX workers.
- Poland: Gliwice, employed 3,582 workers.
- Belgium: Antwerp, employed 2,584 workers.
- Russia: St. Petersburg, employed 986 workers.
The total number of European employees were 54,500 (as of May 2009).
General Motors entered the European market only three years after the company's foundation in 1908. This involved the construction of Chevrolet cars in Denmark in 1923 and Belgium in 1925. This involvement was greatly expanded by the acquisitions of Vauxhall in 1925 and Opel in Germany in 1929. Originally both Opel and Vauxhall had operated independently of each other with totally separate product lines and were direct competitors outside of each other's home markets.
By the early 1970s, GM began to merge the product lines of the two companies, with Opel developing a series of common platforms from which a range of vehicles could be derived. These vehicles carried either Opel or Vauxhall branding depending on market - Vauxhall being used in the British and Irish markets, Opel everywhere else. This in turn allowed manufacturing resources to be pooled, therefore Opel badged vehicles were produced in Vauxhall factories and vice versa. In the United Kingdom - the only market where the two brands were sold concurrently, they were marketed as "Vauxhall-Opel", following the merger of the previously separate Vauxhall and Opel dealer networks in 1980. Opel was positioned in the UK as a performance-luxury brand, with only the Manta, Senator and Monza ranges being offered in the UK. Elsewhere in Europe, Vauxhall's Bedford brand was used on car-derived vans and heavy commercial vehicles.
IBC Vehicles, a joint venture between GM and Isuzu was established in 1985. The new company took over the Bedford van plant in Luton, producing a range of badge engineered light vans based on Isuzu and Suzuki designs. IBC would later go on to manufacture the Isuzu-based Frontera SUV model. Isuzu would later pull out of IBC Vehicles in 1998, with Renault (and later the Renault–Nissan Alliance) taking its place in the venture - which was subsequently renamed as GMM Luton, manufacturing the Vivaro family of light cargo vans.
In 1986 GM officially inaugurated GM Europe, the same year as the last "true" Vauxhall - the Bedford CF panel van - ceased manufacture. In 1987, GM Europe sold the heavy trucks division of Bedford to AWD Ltd, the Bedford brand continued on light commercial vehicles until 1990 when it was dropped completely. The newly created AWD struggled as an independent business away from GM, and collapsed in 1992, bringing an end to the lineage of Bedford trucks and the Dunstable plant was later closed.
In 1988, following the discontinuation of the Manta model (the Senator had become a Vauxhall in 1984, whilst the Monza coupe was killed off in 1987), the Opel brand was formally dropped in the UK market - whilst Vauxhall was discontinued in the Republic of Ireland in favour of Opel six years earlier. GM Europe announced in 1991 that the sixth generation Opel Kadett platform would adopt the Astra name (already used by Vauxhall) - ushering in a new policy of standardization of model names across both brands, further diluting Vauxhall's independence from Opel. In 2002, it was announced that the Vauxhall car production lines at Luton would close following the introduction of the third generation Vectra.
Also in 1986, GM bought Lotus group in England - the first fruit of the purchase being the special edition Lotus Omega/Carlton performance saloon. Seven years later, on 27 August 1993, GM sold the company for £30 million to owners of Bugatti. GM acquired a 50 percent stake in Saab of Sweden in 1989, taking full ownership in 2000. General Motors also developed a partnership with and acquired a stake in Fiat in 2000. GM divested its minority equity interests and dissolved the partnership in 2005, following a legal fight regarding the conditions of a put option afforded Fiat.
Following the 2008 global financial crisis, and GM's plunge towards bankruptcy, on May 30, 2009, it was announced that a deal had been reached to transfer New Opel (Opel plus Vauxhall, minus Saab) assets to a separate company, controlled by a trustee.
The deal, underwritten by the German Government, was negotiated by German Chancellor Angela Merkel. GM was expected to keep a 35% minority stake in the new company, Opel staff 10%, with a plan which proposed to sell the majority of the business to one of two partners:
- A consortium majority-owned by a Sberbank of Russia (35%), Magna International of Canada (20%), and Opel employees and car dealers (10%)
The new company would not be allowed to sell Opel cars in the US (permanently) and China (at least temporarily) markets, which are the two biggest markets in the world.
On June 1, 2009, GM filed for bankruptcy in a court in New York. As the sale of Opel has been negotiated two days before, with the preferred bidder the Magna consortia, both companies were in effect ring-fenced from any GM asset liquidation. Magna stated that their plans for Opel included attracting GM or third-party carmakers to build their cars and electric vehicles in Antwerp. If Opel needed to reduce production of its own core models then any unused capacity could be used to manufacture vehicles for other carmakers. Inside sources close to Magna revealed that some of the possible third party carmakers include Ford and PSA Peugeot Citroen. However, negotiations broke down with Magna over details, particularly the sale of intellectual property rights and distribution of all future GM products in the former Soviet Union.
GM announced that final bids were to be placed with them by July 20, which resulted in three bidders:
- Magna, still backed by Sberbank, had made a last-minute change to its bid in order to placate concerns about its Russian partner's influence. This would result in both partners having a 27.5% share in the new company, with GM retaining 35%
- Belgian-based investor RHJ International
- China's Beijing Automotive Industries - disqualified over "intellectual property issues" a few days later
Towards the end of August 2009 there were doubts over whether a sale of Opel would actually go ahead, though a German government official later revealed that talks were continuing. This was followed by RHJ International raising its bid for Opel to €300m from €275m.
On 10 September 2009, GM agreed to sell a 55% stake in the German brand Opel to the Magna group with the approval of the German government. With this move, Magna Chairman Frank Stronach aims to take Magna from its current role as a parts supplier to an expanded role as a global automaker that ranks “amongst the leaders in selling and building electric cars.” However, on 3 November 2009 the GM board called off the Magna deal after coming to the conclusion that Opel was crucial to GM's global strategy.
Sale of Saab to Spyker
Originally GM planned to sell Saab to Swedish sportscar maker Koenigsegg but the deal fell through in November 2009. On 26 January 2010 Saab was sold to Spyker Cars, forming a company now known as Swedish Automobile.
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