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Opel shoots for an 11-percent share in Germany

Sales chief Gales sees incentives as path to goal

Ruesselsheim. Opel is stepping up its sales promotion campaigns in Germany.

In an ad blitz including television spots, the General Motors brand is offering aggressively-priced lease payments for the entire model lineup, starting as low as 139 euros a month, or about $165 a month at current exchange rates, without a down payment.

A number of large dealer groups, such as Opel Dresen near Euskirchen and Dello in Hamburg, are also using large-display print ads and the Internet to advertise 20-percent discounts on well-equipped "special editions." They are recorded as short-term registrations with no mileage.

Dello is even springing for a certificate worth 1,000 euros, or $1,200, in gasoline.

"Jean-Marc Gales (Opel's sales and marketing chief) is again putting his faith in high volume. And the dealer body is happy to support this because we are achieving decent gross revenues thanks to various bonuses," said Thomas Bieling, spokesman for the Opel dealer association.

Aggressive objectives

Opel is sticking with its market-share goal of at least 11 percent for 2005. But from January to August, Opel has 232,400 new registrations in Germany, a market share of just 10.5 percent.

As a result, the company isn't rejecting low-profit sales channels. For the first half, Opel sold 5,463 fleet vehicles, 23 percent more than during the same period last year. In addition, it recorded 15,789 short-term registrations for that period, or 22 percent more than the first half of 2004.

These campaigns won't hurt the balance sheet, said Carl-Peter Forster, president of GM Europe.

"At the current stage, everyone has to engage in a little hard-selling," he said. "Even a manufacturer from north Germany could only boost its August results with very aggressive campaigns."

Archrival Volkswagen's net price position in the lower-medium segment stood 5 percent above the Opel Astra a year and a half ago.

"That competitor can no longer sustain that price premium," Forster said. By contrast, Opel has "clearly improved its relative margin compared to last year, " he said.

Forster is philosophical about whether Opel will make its aggressive objectives this year.

"Jean-Marc has set an ambitious goal for his sales organization," he said. "We have planned conservatively for our business plan, and that's sufficient to hit our financial numbers."

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