DETROIT -- General Motors CEO Dan Akerson says the automaker is "addressing rather aggressively" the persistent red ink at its European operations.
While discussing GM's $7.6 billion net profit for 2011, Akerson offered few specifics about GM's plans to fix Opel, its European unit. But he made it clear that GM won't sit idly by as Opel continues to weigh on its bottom line.
"We're looking at everything in order to achieve a better breakeven point" in Europe, Akerson said. "There's more to come on this, I think, in the next couple of months."
Akerson wouldn't comment on reports that Opel is discussing with its unions the possibility of job cuts and plant closures. But he believes Europe's labor leaders understand the severity of the economic crisis there, which he equated to the financial crisis in the United States of three years ago.
"I think everyone around the table understands that there's been a material change in the outlook for the European economies generally," Akerson said. "We have to match capacity with demand, and demand has been falling."
GM lost $747 million in Europe last year, excluding one-time charges and gains. That's better than the $1.95 billion it lost there in 2010, but still "unacceptable," Akerson said.
The European results were a black eye on one of the most profitable years in GM's history.
Higher volumes and better pricing in North America drove the gains. GM reaped an average of $2,329 in pretax profits per vehicle on the 3.1 million units it produced in North America last year, up 14 percent from its $2,046 in per-vehicle profit in 2010.
GM CFO Dan Ammann believes that continued strong pricing in North America this year will help to offset profit pressure from a shift in GM's product portfolio away from trucks and toward less-profitable small cars, such as the recently launched Chevrolet Sonic and Buick Verano.
While that shift will hurt GM's profits relative to past results, Ammann said it's part of GM's strategy to reduce its reliance on trucks to drive profits.
"What we're doing is making sure that we have a broader portfolio so that we're aligned with the marketplace," he said. "We want to be matched up so that we're offering the consumers in every segment a winning proposition."