Posts Tagged ‘GM Opel Sale’

GM Net Goes $3b Into the Red for 3rd Quarter – But Still Beats Expectations

Bottom line hit hard by sale of Opel/Vauxhall subsidiary.

by on Oct.24, 2017

Despite a weak third quarter, analysts are showing appreciation for CEO Barra's strategy.

(This story was corrected to reflect the Q3 2017 EBIT-adjusted income for GM and the Wall Street forecast for the quarter.)

General Motors Co. posted a $2.98 billion loss for the third quarter of 2017, its net income hammered by a $5.4 billion charge resulting from the sale of its long-troubled European subsidiary Opel/Vauxhall.

Before taxes, GM actually earned $2.5 billion, a 32% decline from the $3.7 billion EBIT-adjusted number it reported during the July-September quarter in 2016. But Detroit’s automaker nonetheless managed to beat expectations, delivering per share earnings of $1.32 after factoring for one-time charges. Wall Street analysts had forecast earnings of $1.11 per share.

Financial News!

Excluding the hefty cost of exiting Europe, “The way to really think about the business is obviously continuing operations and the core business,” said GM Chief Financial Officer Chuck Stevens. Significantly, all of GM’s other operations – including North America, South America, China and other parts of the world — were profitable for the first time since the fourth quarter of 2014.


GM Continues Global Retrenchment; Halting Sales in India, South Africa

Profitability the key goal, not sales, for CEO Barra.

by on May.18, 2017

The Indian automotive market has mushroomed, but GM determined it wouldn't be profitable to remain there.

Long the global automotive leader, General Motors is ramping up its strategy of retrenchment, CEO Mary Barra ordering it to stop selling vehicles in both India and South Africa, as well as the countries in East Africa.

The early Thursday announcement follows earlier moves by Barra, who became the industry’s first female chief executive in January 2014. She pulled out of Russia a year ago and, in March of this year, announced that GM would sell off its long-troubled European Opel/Vauxhall operations to France’s PSA.

We Track the Changes!

“As the industry continues to change, we are transforming our business, establishing GM as a more focused and disciplined company,” said GM Chairman and CEO Mary Barra. “We are committed to deploying capital to higher return initiatives that will enable us to lead in our core business and in the future of personal mobility”


GM Stock Could Pop on Opel Sale

Sale of unprofitable business could net shareholder windfall.

by on Feb.20, 2017

Mary Barra, GM chairman and CEO, met with leaders in Germany to assuage concerns about the potential sale of Opel to PSA.

Shareholders reacted skeptically to last week’s announcement that General Motors was in discussions to sell off its money losing European operations anchored by the Opel and Vauxhall brands to the Paris-based PSA Group.

But the weekly financial magazine Barron’s gave the proposed sale of Opel a boost when it said GM’s share could increase in value by as much as 35% if the deal was finalized and GM succeeds in finishing the sale.

Global Auto News!

If the deal goes through, it could net GM as much as $1 billion in cash, Barron’s says, citing analysts. However, the real value from the sale would come from offloading a money-losing business and refocusing on operations in China, Latin America and North America, it said. (more…)

GM Board Balks and Decides to Retain Opel!

Control of product development and patents overrules speculators and GM's need for cash.

by on Nov.03, 2009

The Board of Directors at reorganized General Motors Company has decided to keep Opel and Vauxhall and will initiate a restructuring of its European operations “in earnest,” it said late today in a statement.

“GM will soon present its restructuring plan to Germany and other governments and hopes for its favorable consideration,” said Fritz Henderson, president and CEO. “We understand the complexity and length of this issue has been draining for all involved. However, from the outset, our goal has been to secure the best long-term solution for our customers, employee, suppliers, and dealers, which is reflected in the decision reached today. This was deemed to be the most stable and least costly approach for securing Opel/Vauxhall’s long-term future.”


GM Opel Sale to Magna-Sberbank Delayed, Again

Company now says that it will go the November Board Meeting.

by on Oct.23, 2009

Critics contend that Germany, as the largest potential contributor of funding -- €4.5 billion ($6.8 billion) -- unfairly manipulated plant closings to keep more jobs there.

Critics contend that Germany unfairly manipulated plant closings to keep more jobs.

Our favorite blogger covering the ongoing Opel saga, John Smith of GM, said this morning that the Magna/Sberbank deal was delayed until at least the regular GM Board of Directors Meeting on November 3.

The sticking point now appears to be the financing that allegedly tilted the decision to Magna – how much, and by what governments?

Smith, who is the lead negotiator on the sale, implied that the deal would be ready to go by November after months of delay. The GM Board last reviewed the matter in September and instructed Smith to proceed with the Magna-Sberbank deal.

However, even if the GM Board approves the sale next month, it is still not clear that all the legal approvals from the European Union will be in place.

Since approval was given for the sale to the Canadian-Russian consortium, the European Union has been reviewing the Opel investor process and the circumstances surrounding the selection of Magna-Sberbank. A key document appears to be a letter from German Economics Minister Karl-Theodor zu Guttenberg that sets forth terms.

Do It Now!

Do It Now!

Critics of the deal contend that Germany, as the largest potential contributor of funding — €4.5 billion ($6.8 billion) — unfairly manipulated plant closings to keep more jobs there. Opel/Vauxhall also has efficient plants in Spain and the United Kingdom.


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