Lower price point for Opels, Vauxhalls
CEO Stracke will shift upscale price strategy
Stracke: Needs "traditional" base
MONTE CARLO, Monaco -- In an effort to win back buyers, Opel/Vauxhall will move toward lower-priced models, CEO Karl-Friedrich Stracke said.
Stracke didn't say how or when the new pricing policy will be implemented. It's unclear whether current nameplates will have their prices cut or whether Opel will aim to develop less expensive vehicles.
He brushed aside worries that the reversal in Opel's upscale pricing strategy would put the European brand in competition with Chevrolet, which has been designated a global brand by General Motors, the parent of both Opel and Chevy.
"We need to regain our traditional customer base," Stracke told the Automotive News Europe Congress here. "We moved Opel up too quickly. Going forward there will be adjustments to make our cars more affordable."
Stracke also said the GM unit will not reduce investments in new products despite Europe's debt crisis.
"We will make a significant investment in Opel's product portfolio. I noticed with interest that some of our key competitors have announced plans to cut product investment spending," he said.
Fiat CEO Sergio Marchionne said last week that the Italian automaker is cutting product development investments by 500 million euros, or about $630 million.
Stracke reiterated Opel's plan to introduce 23 new or refreshed vehicles by 2016, including cars in new segments for the brand such as the Mokka subcompact SUV and Adam minicar. The brand will also introduce 13 new powertrains including three new engine families.
"Product is king and the key to future success," Stracke said.
The product offensive will be combined with new sales strategies aimed at Opel regaining traditional customers and attracting new buyers, the CEO said.
Stracke said his aim was to return Opel to sustainable profitability, but he could not give a time frame in the current economic climate.
Measures to make the brand profitable will include improving capacity use in vehicle assembly plants, improving production efficiency, leveraging GM's global organization and finding synergies from the alliance between GM and PSA Peugeot Citroen.
Stracke said Opel's pricing strategy will not bring the brand into competition with sister GM brand Chevrolet. Said Stracke: "Customers don't see the brands as competitors."
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