GM sells opel

[NC-car-guy]

I heard on the news this morning that GM is moving out of the European market which included selling opel.

[8E45E]

And GM's Brexit!

 

It also includes Vauxhall:  http://forum.studebakerdriversclub.com/showthread.php?99406-General-Motors-may-sell

 

Craig

[SpecialEducation]

Yep. :o/ http://www.detroitnews.com/story/business/autos/general-motors/2017/03/06/gm-opel-psa-sale/98783864/

[ol' yeller]

I wonder what this means to Buick as they have a couple of cars in their lineup that come from Opel.

[60FlatTop]

Guys like this taking out the plants don't make the stockholders happy.

 

But that was 80 years ago, silly me.

Bernie

[retirednow]

I saw this on Varney and Co. this morning. I wonder what will become of the Cascada, which is also marketed under Opel and Vauxhall badges

[Larry Schramm]

If you are not talented enough to fix a problem then you just off load/ sell it.  Sad to see GM getting smaller in their global footprint.  Continuing the saga of the 80's under Roger Smith of selling off everything including the plants and equipment that were bought and paid for decades ago and then leasing them back. Era of eating your seed corn continues.

 

Remember, If you own your house free and clear and you get laid off it is an inconvenience.  If you are renting your place and get laid off it is a crisis.

 

The car/truck business is cyclical and think the high in sales you are making a lot of money and when sales tank you are laid off.

 

It is the nature of the business for over 100 years and will always be. 

Edited March 6, 2017 by Larry Schramm (see edit history)

[60FlatTop]

I read My Years With General Motors by Alfred P. Sloan three times, On A Clear Day You Can See General Motors by John Delorean twice, and Iaccoca by Lee Iaccoca once, if I finished it. I listed them in chronological order. Sloan wrote a pretty good book about what "we" did. The general transition, in the industry, to what "I" did shows up in the writings. Look up the origin and feats of The Whizz Kids.

 

When the Senate asked Rick Wagoner what he would do with the bailout money I remember one item was "make payroll". I heard the springs on my Chevy truck groan on that one.

 

Then "someone" grabbed all my stock and, totally lacking in due diligence, got their hands on a company with a known killer car. Should have paid more attention on that one!

 

After about ten years of a dramatic show of profit from selling the spoils of the stock switcheroo there is a little trouble, no kidding.

 

The Hogan's Heros picture was not that much of a joke. Why are the majority of newer plants in Europe?

 

I watch this stuff. I was with Eastman Kodak when one could purchase all the stock, sell the paid for assets. and make a tidy profit.

 

I sat in a meeting at Bausch & Lomb and asked if the company gross sales was really $160,000 per employee. Someone said "Oh, I never looked at it that way." It was somewhat inaccurate.

 

There is a common problem with companies over 50 years old. They have lost the spark and vision of the founder. About 20 years after the founder dies the last person closest to them is gone. And it is never the same after. Check what happened 20 years after the death of any company's founder. You will see a crisis in identity. You can't change it, but knowing it will happen can benefit.

Bernie

 

[Larry Schramm]

I believe I could probably pin point the beginning of the end of GM and the rest of the domestic auto industry. 

 

There were actually two dates. 

 

Ask me in person and I will let you know my thoughts and why.

[SpecialEducation]

I fear this is more bean counters run amok, which is a shame because some of the best GM designs in recent years has come from Opel. My biggest complaint with the designs that were brought over to the US market was that they didn't offer them in versions unchanged from the European market versions. 

[NTX5467]

Congrats,Bernie, on reading the DeLorean and Iacocca books!  I've read them, too.  Together, they explained a whole lot of what I'd head the old-line parts guys and managers talk about with respect to the way GM did things.

 

Opel has not been that profitable for a few decades, as I understand it.  There were some talented people over there, but the Euro market is far tougher than we might suspect, apparently.  Opel was used to design many smaller cars for GM which were also then sent to Australia/Holden for local fine-tuning and production.  They were also on individual parts in several vehicle designs, too, as I understand it. 

 

The Cadillac Catera was the "short wheelbase" Opel sedan.  The Holden Monaro (and THAT family) were Opel designs, too . . . BUT customized for the Aussie market.  That's another story of what they did to make it a Holden vehicle, from what I've figured out from looking at the Catera and then the "Pontiac" GTO.  I believe the Monaro platform was the basis for the current Camaro platform, but customized for the USA marketplace AND built in North America (that part is important, too . . . another story related to the G8).

 

When I saw an article about "something next week", last week, the first thing I thought of was the Cascada (built in Poland) and also sold as a Vauxhall.  The news story I heard on NPR noted that there were two Vauxhall plants in England and how they might fare with Brexit looming.  At least initially, it was stated that no
GM workers would loose their jobs.  As the combination progresses, that might change, I suspect.

 

As the purchasers have "larger" on their mind, they can continue the Opel models until the tooling gets old and then further consummate "the marriage" of models and brands.  End result is that they'll need the factories and distribution networks to accomplish their "larger" goals.  We'll have to wait to see how that evolves!

 

As good as Opel might have been, when the word "German Car" were mentioned, one usually thought of Mercedes, BMW, and VW (et al).  Opel would have been an "Oh, yeah" reaction.  It was good that when Buick needed a more economical car, they imported Opels for that function.  When they later imported "Japanese" Opels, it ruined the Opel name, to me.  Probably didn't work too well for the related Germans, either!  Opel always seemed to be a good vehicle but not a perceived "outstanding" vehicle.  I had a friend in college that has an Opel coupe (1972 or so).  A nice car and it worked well.  Strange to see an import brand vehicle with AC spark plugs (to me, at that time).  He drove it hard and it didn't have any issues.  Only unique feature was the (appeared add-on, but factory) oil pressure gauge.  When he started the engine the first time, the needle stayed at "0" until it had run about 30 seconds, THEN it sprang to life with a perceived "boing!!".  It scared me the first time I rode with him as he passed it off as "normal".  I had another friend whose girlfriend had an early Mercury Capri.  THAT car was more fun, for many reasons, even with the smaller-than-later-size engine.  He was kind of half-crazy and it all fit together nicely!

 

GM could move Cascada production to China or another "craft center" in the USA.  The NPR news item mentioned that Gm was going to focus on more profitable areas of the world they were already in, mentioning China specifically.  I believe they've already left Australia?  Once more, GM sheds money losers to better concentrate on more profitable areas.  Kinds of sounds like we've heard that dialogue before?

 

There was word that FCA was possibly trying to purchase Opel, but then Sergio's employers started him on "partner" talks a while back.  GM paid $$$$$ to get out of the prior partnership with Fiat and declined any later offers.  Almost like he's trying to kill the corporation he "got" for a very big bargain?

 

As much of a boon to Buick that the Cascada has become to the brand's image, I HOPE it continues for another couple of years!

 

NTX5467

[Gene Brink]

On 3/6/2017 at 0:31 PM, 60FlatTop said:

There is a common problem with companies over 50 years old. They have lost the spark and vision of the founder. About 20 years after the founder dies the last person closest to them is gone. And it is never the same after. Check what happened 20 years after the death of any company's founder. You will see a crisis in identity. You can't change it, but knowing it will happen can benefit.

Oftentimes true but not always. For example check Disney... GM (indeed all of the "Big Three") have lost market share over the last 50 years and I fear will never regain the lost ground. Thankfully Buick is building cars that do a much better job of battling for market share however so many younger buyers (say under 50) have formed the opinion that imports (especially Japanese) are much better than domestic and will not even consider a domestic make.

[RivNut]

My kids, all under 50 aren't into Japanese cars. Two Volvos, a hardtop convertible and an SUV; a Mini Cooper "S"; a Ford Explorer, a VW Passat TDI, and an H-D "Fatboy."  Where'd I go wrong?  

[NTX5467]

Valid point, Gene, and we've seen it in the dealership side of things, too.  Far too many times, "the kids" want to do something else than be in the car business, although the car business usually supported their lifestyles quite nicely, including expensive universities, too.  Finding a third-generation dealer that is still successful have become more and more rare.  In many cases, one of the mass-market chain dealer groups becomes the new owner, by observation.

 

In our situation, the dealer is a second-gen dealer who has done very well for himself.  Over the nearly 50 years he's had the store, it's grown from just a Chevy dealer to a full-line GM store (pre-and post-bankruptcy).  He did receive the "We want you to continue with us . . ." letters from GM, which was good.  And things keep growing with other brands (Toyota and Hyundai, plus Nissan at one time).  In more recent times, he's put "a plan" in place with existing long-time employees.  He'll probably transition more "out" in a few years, but that remains to be seen.  As long as HIS name is on the sign and the customers (many generations of customers!) know that things haven't changed, they'll continue their existing relationships as long as they can, I suspect.  IF that name comes off the sign, it's just another metro dealership.

 

It's an observed fact that when a USA car company leaves a market segment, for whatever reason, the "other" brands have planned on a new product to fill that void.  Former Olds customers stayed with their dealership and bought the brand the dealer was also selling.  They generally didn't migrate to another GM brand or dealership, unless they wanted to.  On the USA side of things, when a model is deleted from the portfolio of vehicles, it's usually due to "low/decreased sales", BUT such things can also be orchestrated by the OEM not maintaining investment in the particular product OR its advertising brochures.  This can also dovetail with the age of the plant and where production might be moved to.  Plus some "hidden agendas" that aren't known up front, but all figure into the situation.

 

Many of our more vintage operatives might well know which brand is "imported" or not, but as man younger people have grown up with them, it seems to be less important.  Saturn happened at the right time for the WWII generation to need to replace their aging Darts and Valiants, so for them, the "USA fighting and winning against the Japanese" fir right in.  When Saturn brought over non-USA vehicles, the allure of Saturn vanished and Saturn did too.  Too many people inside and outside of GM didn't really understand why Saturn was needed and WHY it worked . . . Chevy dealers couldn't "give away" Cavaliers with discounts, but Saturn dealers sold their cars at MSRP all day long.  Many GM operatives just knew how much additional money it took to make things happen and build a dealer network, rather than the good press that Saturn was getting (and other GM brands were not).  Lots of dynamics.

 

GM lost market share during the Smale "brand management" era, but made money, but when market share approached 20% THEN people got concerned.  It all depends upon who's in charge at the OEM upper levels.  "Bad" leads to something "good" or "better", then back to "poor" again, usually.  The cycles might take 10years to repeat, though.  At the dealership side of things, when the 3rd-gen family members are running things, that's usually when things start to decrease, by observation.

 

NTX5467

[SpecialEducation]

8 hours ago, RivNut said:

My kids, all under 50 aren't into Japanese cars. Two Volvos, a hardtop convertible and an SUV; a Mini Cooper "S"; a Ford Explorer, a VW Passat TDI, and an H-D "Fatboy."  Where'd I go wrong?  

 

Kinda reminds me of a guy I once new who was looking for a job. He was the boyfriend of a co-worker of mine. Before I had kids (when I had spare time) I did a lot of dealer trades for the Pontiac, Buick, GMC dealership my wife worked at. I told this guy that I could use some help driving cars from time to time.  Pay isn't awesome, but it's a fun way to see the country on someone else's dime, and its better than sitting on the couch at home. 

 

He says, "I don't drive domestic cars."

 

Idiot.  I told her to dump his stupid, lazy butt. 

Edited March 9, 2017 by SpecialEducation (see edit history)

[JohnD1956]

9 hours ago, Gene Brink said:

Thankfully Buick is building cars that do a much better job of battling for market share however so many younger buyers (say under 50) have formed the opinion that imports (especially Japanese) are much better than domestic and will not even consider a domestic make.

 

I am not sure about the younger buyers intentions.  But I believe cost comes into play in the decisions.  This may be about to change somewhat, since drilling down to the asking price for well options vehicles seems to show that every manufacturer is very close to the others in todays market. 

Then again, how many younger buyers can afford to buy a new car at all?  Seems everyone is leasing so they can get the lower payment.  At the end of the lease it's time for a new...lease... and if the cost is the obstacle, then it will be the cheapest lease.   To me it seems that these lease holders have little concern for brand loyalty.  

What is apparent however, is that younger folks are still into older cars, en masse.  The thing I find intriguing however, is that todays teens to 40 somethings, actually make more comments about my beat up 78 Wagon, than my other cars.   LOL.. I credit National Lampoon for that however.

[SpecialEducation]

2 minutes ago, JohnD1956 said:

The thing I find intriguing however, is that todays teens to 40 somethings, actually make more comments about my beat up 78 Wagon, than my other cars.   LOL.. I credit National Lampoon for that however.

 

Now that's just wrong. The Truckster was an ugly old F*rd.  I wouldn't give it credit for anything. 

 

I like wagons because I have 3 kids but don't want an SUV. 

[60FlatTop]

27 minutes ago, JohnD1956 said:

The thing I find intriguing however, is that todays teens to 40 somethings, actually make more comments about my beat up 78 Wagon, than my other cars.  

 

They all sneak over to Bella-Napoli's and get loaded up with sugar, makes them a little nutty.

Bernie

[Thriller]

Dealers need to keep stock on hand too. When we got the Regal, the dealer had to bring it in from another dealership. They had zero new Regals in stock but a parking lot full of trucks and SUVs (granted a semi-rural dealership). We bought the Regal without ever actually having sat in nor driven one. That said, we generally trust Buick and most won't do that. When we went to pick it up, the salesman commented how good-looking it was and that they should get some...sigh. 

 

It seems rare that dealers have what I want. 

 

[SpecialEducation]

Dealer stock is a game. We kept high end cars in stock, even though low end sold better. Small town dealers tended to do the opposite. We'd keep the holdback for the high optioned car, and sell them someone else's low end car. After all of that, we'd still be money ahead. We sold more cars than any other dealership in the state, and were #2 in trucks. I've sat in a manager's office when he was ordering trucks. There was no science; just what ever he was in the mood for that day.

[Paul White]

I was also wondering about the Cascada which has been re-badged as GM-Holden here in Australia. In saying that GM are ceasing local design and production here at the end of the year. In the '20s and '30s Holden produced its own Buick bodies on the imported chassis'. The images are of the last locally designed and built Holdens. 

380ci Supercharged V8 producing about 570 hp. If we are lucky we might start receiving some "real" Buicks in Australia again! 

 

[NTX5467]

With each new model year, our guys would order a mix of vehicles.  Generally mid-line options and a few "gut loaded" vehicles.  The option level was usually "good" BUT also cars that we could sell as used cars in a few years.  Pickups were optioned "to work" rather than just look good, including a few additional chassis items other dealers didn't order (so they could have a better price), but they all looked the same on the outside.  Again, trucks we could trade-back for in a few years and they'd still be good working trucks. 

 

When Cadillac came out with the SRX, they sent a loaded V-8 and a mostly-loaded V-6 for demo use.  It seems that too many dealers ordered highly-optioned SRXs up front, so with their elevated MSRP, sales were slow.  No mention of the dealers trying to get MSRP on a new vehicle, though!  So, lesson = more mid-price cars, more like people actually purchase rather than high-option show pieces (which few people purchase).  Having ONE or TWO high-option cars for show is good, but not a whole rows of them!

 

Bad thing is that dealer allocations are usually based on prior sales.  Perhaps the dealership hadn't sold any Regals and probably had a very low allocation for them?  If one was ordered, it would take a while to get it built.  Better to dealer-trade one.

 

There are other issues related to dealership orientations, but that's for another time.

 

NTX5467

[Beemon]

Kinda funny talking about only driving domestic cars, Buick isn't even made in America anymore. Maybe that will change now that GM is dumping their foreign business.

[NTX5467]

We MUST remember that GM is a multi-national company. For quite some time, they have been spreading design and engineering work throughout the organization.  In a recent design orientation, they desired to build ONE platform that went to all markets.  This resulted in (for example, the last-gen Camaro) vehicles being heavier than they could have been in order to meet USA crash impact standards.  A heavy Camaro is one that takes more power to match less-weighty competitors (i.e., Mustang), with similar results in the gas mileage ratings.  End result, the most recent GM designs are based on one general platform which is then customized to particular market areas.  Weights have dropped, generally, with this orientation AND new construction techniques (a lighter Camaro and Cadillac CT6, for example).

 

Back when GM was bragging or its world-wide scope of product, bringing certain aspects to North America and releasing a Buick concept car in China first, I suspected that as much as they were ballyhooing this, I suspect it would come back "to bite" (with some long-time customers who felt GM was a USA corporation FIRST) at some future date.  I never have really figured out why GM-Europe has been so troubled with profitability as other "local" brands seemed to do better.  What could Opel have been doing better?  BUT Opel had also been doing much of GM's small car global designs, perhaps many costs were being transferred to that operating unit from other areas?  Kind of like the United States Postal Service losing profitability as they had to "super-fund" retirement benefits far above what was really needed for a good safety margin?  But then Ford-Europe used to have profitability issues in Europe too, but if they were the same problems GM had might be something to investigate.  Ford's issues went back into the later 1960s, as I recall.  But it's all over now, for GM-Europe.  It will be interesting to see what PSA does differently OR has done differently to be successful.

 

Each global organization has their own "processes" which can be unique to the particular company.  European process can be different from USA or Australian processes.  I found an article in a tooling magazine of how Holden was doing great things down there with some ways they did things.  For example, they had two wheelbase platforms.  So they had one stamping, cutting off of one what was not needed for the other.  Recycling INTERNALLY the cut-off metal in the process.  They could also tap into the Asian tool makers (due to Australia's location) and get better machines at lower costs.  So their "shoe string" approach worked well for them and allowed operating costs to be decreased, which made them more nimble and profitable.

 

One thing Lutz tried to do was to standardize tooling such that one part could be removed and shipped to another plant.  The old "interchangeable parts" orientation!  THAT took some doing as each installation was "customized" for the location, at possibly elevated costs.  These are all things which usually aren't known unless somebody looks for them, which I found some magazines that did look at them.

 

NTX5467

Edited March 10, 2017 by NTX5467 (see edit history)

[retirednow]

http://blog.caranddriver.com/opel-sale-will-not-affect-buick-lineup-gm-execs-say/