General Motors’ European head has said that the carmaker’s regional unit is ahead of its plan to break even this year.
Nick Reilly, president of GM Europe and chairman of the Opel/Vauxhall supervisory board, also said on Wednesday that the carmaker had reached agreement with its UK union on a two-year 4.5 per cent pay rise.
Mr Reilly declined to comment on the profitability of GM’s Opel/Vauxhall and Chevrolet businesses in Europe ahead of second-quarter financial results, which it is due to report on Thursday.
However, Mr Reilly said the company was ahead of its target of breaking even for the full year before restructuring charges.
“If we can be break-even this year, we will get the full benefit of restructuring [and] can be decently profitable in 2012”, Nick Reilly told journalists. .
“Without talking about the results tomorrow in general, we are ahead of the plan up to now,” he said.
GM’s Opel unit has long been a lossmaker for the Detroit carmaker and, in recent months, the subject of speculation that it might be up for sale, which Dan Akerson, the chief executive, recently denied.
When asked whether GM had been approached by a rival carmaker seeking to buy Opel, Mr Reilly said: “Not as far as I know.”
However, he said, GM was “frequently talking” to other producers about alliances in new technology, especially in areas such as vehicle electrification, where many carmakers are seeking to cut costs.
In 2009, as GM was restructuring in bankruptcy in the US, it embarked on talks to sell Opel to outside investors, before pulling the plug on the sale in a move that infuriated the government and its union in Germany.
Opel, which trades as Vauxhall in the UK, has over the past two years completed a restructuring plan that saw it cut about 8,000 jobs, freeze wages and close a production plant in Antwerp in an attempt to make the business more competitive.
Mr Reilly said GM had reached agreement on a two-year wage rise with its UK workforce.
“We have just had an agreement in the UK from the unions, but they have to get it through the vote,” Mr Reilly said. “We have agreed a settlement of 4.5 per cent”.
Britain is GM’s second-largest country of operation in Europe, after Germany, and its fourth-largest in the world.
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