Staff Writer - CheersandGears.com
September 10, 2012
Last Thursday, Morgan Stanley released a report saying GM should sell off Opel and settle it losses.
The report says GM has lost $10 to $20 billion over the past three years to Opel. If GM keeps the brand, the report says it will cost it up to another $12 billion over the next 10 years. Closing Opel isn't a good option at all says the report due to the enormous costs of winding down manufacturing operations in Europe. The report goes on to say that if GM was to sell Opel, that it would cost between $7 and $13 billion dollars.
UBS auto analyst Colin Langan told the Detroit Free Press that if GM was to sell off Opel, it could have some problems trying to find a buyer.
"Automakers that want to grow in Europe would likely look to build capacity in lower-cost eastern Europe, rather than acquire high-cost western European facilities," Langan said.
"We are committed to Opel and believe we can restore it to long-term profitability," GM spokesman Jim Cain told the Detroit Free Press when asked about the report.
Source: Detroit Free Press
William Maley is a staff writer for Cheers & Gears. He can be reached at email@example.com or you can follow him on twitter at @realmudmonster.