Opel under the wing PSA began to get out of the lossesJuly 25, 2018
As reported in the financial report of PSA for the first half of this year, the alliance for this period increased net profit by 18%, to 1.48 billion euros, while Opel and its British “brother” Vauxhall earned 502 million euros in the first half of the year, then as last year recorded a loss of 179 million euros. In 2016 things were even worse – losses amounted to 257 million euros. It is worth noting that the last time Opel recorded profits in the distant 1999.
According to the Reuters news agency, the Germans managed to achieve this result thanks to the tough PSA policy. The management of the concern dismissed about 3,700 people from the state of Opel, and the alliance is going to say goodbye to the development department of the German brand, which now employs about 4,000 people. Overall, PSA cut Opel’s costs by 28%, and also reduced the cost of production of each brand car by 700 euros.
A role in “recovery” of the brand was played by new crossovers, which Opel began to focus on, although it should be noted that the brand still “failed” in car sales in Europe – from 984 769 in 2016 to 935 169 last year . Nevertheless, according to the analyst of the company JPMorgan Jose Asumendi, Opel is recovering with an unprecedented speed for the automotive industry.
As for the PSA Group as a whole, following the results of the first half of the year the concern increased sales of cars by 38% – up to 2.18 million units, the revenue of the alliance for the reported period increased by 40.1% – up to 38.6 billion euros. All this led to the fact that PSA shares “took off” in price by 10%, and the capitalization of the alliance reached almost 19 billion euros.