COMMENT: Further cost cutting could ruin Opel

COMMENT
Franz W. Rother is Editor-in-Chief of Automobilwoche

Opel boss Carl-Peter Forster is to be called to Zurich to the new post of COO of General Motors Europe. There, he will to push the integration of GM Europe's Opel, Saab and Daewoo brands.In fact these changes are already happening on the ground. A car dealer in Landsberg, near Munich, is currently exhibiting the new Opel Astra next to the new Daewoo Lacetti with no partition wall between them. The cars compete against each other in the same segment. The only difference is that the Korean Lacetti costs approximately 1,000 euros less than the German Astra.This is not the only example. GM Europe will soon launch the new Opel Tigra TwinTop roadster jointly with the Saab 9-3 and the new Daewoo Nubira Wagon.Forster was employed three years ago to lead Opel out of its image crisis and into profit. Now he will reorganize the GM brands in Europe from Zurich and develop concepts to save costs through increased synergies between Opel, Vauxhall, Saab and Daewoo.

GM's headquarters in Detroit has already given us some idea of where this path leads. GM models will in future not only be developed jointly -- they will also be manufactured and marketed together.

National pride, individualism, and differences between countries and continents will be disregarded.

The Saab 9-2X, a disguised Subaru Impreza, is already being produced in Japan. The Saab 9-7X SUV, a masked Chevrolet TrailBlazer, will soon be launched in the U.S.A. The Vauxhall brand only exists on paper and their cars are completely identical to Opel models.

There are fears that badge engineering will be the rule at GM in the future rather than the exception.

No wonder Saab chief designer Michael Mauer recently moved to Porsche and Opel's head of design Martin Smith escaped to work for the competition, Ford. Even there designers seem to have more artistic freedom.

After Hans Demant's promotion to lead Opel, the post of head of Opel's design and engineering department may not be filled. That would not make any sense anyway, since Zurich will be responsible for everything from now on.

Adam Opel AG in Ruesselsheim will more or less be turned into a sales organization, 75 years after General Motors took over the tradition-rich German automaker.

GM Europe has had control over production locations in Spain, Belgium, Poland and Great Britain for some time. From now on the Zurich headquarters will also be responsible for Opel's German plants.

GM's headquarters in Detroit has the final say. Finance president John Devine wants to make fewer cars in Germany due to the country's high wages. Forster will not be able to resist Devine's wishes and will probably demand further cuts from the German Opel employees, sooner rather than later.

GM's new course in Europe is neither good for Opel or for Germany as a production location. There can be no doubt that jobs will be lost in Ruesselsheim, Bochum and Eisenach. And I fear that the cost-cutting measures will only harm Opel's image.

Opel was on its deathbed a few years ago but it recovered a little under Forster's leadership. Another wave of cost saving measures could finally ruin the brand.

Forster knows that. But he also knows that the new GM Europe boss Fritz Henderson is aiming to bring the world's largest automaker's European operations back to profitability. Henderson will not pay any attention to German interests when pushing through his restructuring program.

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