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Elham AbolFateh
AR
Tuesday 30 May 2017

Automobile

Why is Vauxhall being sold to Peugeot's owner?

Tuesday 07/March/2017 - 10:48 AM
Sada El Balad
Edited by Alaa Turki

Vauxhall and Opel are being sold to the company that owns Peugeot and Citroen for 2.2bn euros (£1.9bn). We look at the logic behind the deal.

Why is General Motors' European business up for sale?

In a word - profit. Or more accurately as far as GM Europe is concerned، 18 years of losses.
The last time the US carmaker's European business، which houses Germany's Opel and the UK's Vauxhall، made a profit was in 1999.

Although the division's boss، Karl-Thomas Neumann، pledged to return to growth in 2016، the operation ended up reporting a loss of $300m (£245m).

Both Vauxhall and Opel have been part of General Motors for nearly 100 years.

GM bought UK business Vauxhall in 1925 for $2.5m. It acquired a majority stake in Germany's Opel in 1929 and bought the remaining shares in 1931.

Both brands' share of the European market has been shrinking for some time. In 1990، they held a combined 11.5%، but by 2016 this had fallen to 6.5%، according to carsalesbase.com.

Source: BBC

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