GENEVA -- General Motors' European division may not reach its target of breaking even this year and may lose as much as 200 million euros ($218 million), the chief of the company's European operations said on Tuesday.
"We're still trying to get to break-even in 2003. ... We have a range of about a 200 million loss to break-even," Mike Burns told reporters at the Geneva auto show.
GM Europe has posted heavy losses in the past two years as it struggles with a morose economy in Germany, its biggest market in the region, and competitive pressure on its mass-market brand Opel.
To boost its fortunes, the world's biggest carmaker is counting on cost savings and a strong take-up for new vehicles such as the Opel Signum wagon and the Saab 9-3 convertible, both of which will debut in Geneva.
But company managers have conceded that the world's biggest automaker may lose money in Europe again this year.
GM's sales in Western Europe fell eight percent last year to 1.55 million vehicles, for a market share of 9.4 percent, down from 9.9 percent in 2001, according to Ward's Automotive Reports. Only Italy's crisis-ridden Fiat had a steeper drop in car sales last year among the major automakers.
Carl-Peter Forster, a former BMW board member, took over at the head of Opel after a string of American predecessors who were widely seen as failing to understand the European market and the structure of German companies.
He plans to spend 10 billion euros on new models in the five years to 2006. In recent years, the brand has suffered from a dull product line-up, heavy discounting and the weak German economy.
GM is faring better in the U.S., thanks to strong sales of its highly profitable sport utility vehicles and pick-up trucks.
As a result, the company's fourth-quarter net profit soared to $1.02 billion from $255 million a year earlier, despite steep consumer incentives.