FRANKFURT, Germany (AP) — General Motors has appointed the former head of Volkswagen’s China business to try and turn around its lossmaking European division, Opel.
The Adam Opel AG board of directors on Thursday named Karl-Thomas Neumann as CEO. Neumann, 51, also got the title of head of GM Europe and GM vice president.
Neumann formerly headed parts maker Continental AG and ran Volkswagen’s booming China business for two years until August, 2012.
He inherits a tough job from his predecessor, Karl-Friedrich Stracke, a veteran GM exec who resigned abruptly last year amid poor sales and earnings. GM has struggled for years to make money with its European business. Ruesselsheim-based Opel faces weak demand from a slow European economy and tough competition with other automakers for sales of smaller, mass-market cars that bring less profit than luxury models.
Part of the problem is that GM needs to reduce its European manufacturing capacity to cut costs. But union agreements have made it hard to close factories.
GM lost $478 million pretax in Europe in the third quarter, compared with a $292 million loss a year earlier. The company has predicted further European losses this year but expects to cut them by a third to a half this year and break even there by mid-decade.
Opel, which makes both Opel and Vauxhall cars, had been headed on an interim basis by strategy chief Thomas Sedran since the abrupt resignation of Stracke last year.
Steve Girsky, chairman of the Opel board, said that Neumann “has a proven track record in growing business in a profitable way as well as in turnarounds.”
GM CEO Dan Akerson said that the move “will ensure we have the best possible leadership in place as we continue driving toward profitability and growth in Europe.”
More Related Stories
- Russia: Syrian regime ready to participate in peace talks
- Report: Nearly a quarter of all Americans struggle to afford food
- Ted Cruz against the world
- Louie Gohmert: Women should be forced to carry nonviable pregnancies to term
- 2 men arrested for endangering commercial aircraft
- Oversized load blamed for bridge collapse
- This is what Guy Fieri looks like as a balloon
- Iran hackers aiming at U.S. energy firms
- Lawyers release data in attempt to discredit Trayvon Martin
- Anonymous rallies behind Kaitlyn Hunt
- Bridge collapse: Part of "aging infrastructure"
- Mistrial in penalty phase of Arias case
- Amanda Bynes arrested after hurling bong from window
- Interstate 5 bridge collapses north of Seattle
- Mississippi could begin prosecuting women for miscarriages
- Teenage girl claims she was beaten up for looking like Taylor Swift
- UK Military: London attack victim was a "model soldier"
- Billionaire hedge funder: Babies, breast-feeding "kill" focus, keep women from succeeding
- "Bookless library" set to open in Texas
- 2 more arrested in London attacks
- Glenn Beck: CNN interview with atheist tornado survivor was a setup!
Featured Slide Shows
The week in 10 picsclose X
- 1 of 11
Credit: AP/LM Otero
Credit: AP/Matt Rourke
Credit: AP/Jenny Aicher
Credit: AP/Molly Riley
Credit: AP/J. Scott Applewhite
Credit: AP/Carolyn Kaster
Credit: AP/Las Vegas Review-Journal/Jeff Scheid
Credit: AP/NASA/Chris Hadfield
Credit: AP/Jacquelyn Martin
Credit: AP/The Duluth News-Tribune/Clint Austin
Recent Slide Shows
- 1 of 11