Scrappage scheme saves opel from billions in losses

The scrappage scheme saved carmaker opel from an originally feared billion-dollar loss in 2009. For 2010, however, the manufacturer continues to expect a "negative result in the billion range", adam opel gmbh writes in its annual financial statements.

Originally, a negative result in the region of 1.2 billion euros had been forecast for fiscal 2009: "actual net loss amounts to 427 million euros", the management explained in the paper, from which the handelsblatt quoted in advance. The improvement over the company’s own forecast was due in particular to the "environmental pamphlet" from which a total of 5 billion euros in government subsidies were distributed to buyers of new cars last year.

How opel is actually doing, however, can at best only be guessed at from the annual financial statements. "Figures refer only to business activities of adam opel gmbh in germany. These are not consolidated financial statements, but the financial statements of a state company", a spokesman in russelsheim told dpa. Opel’s parent company general motors (GM) has reported that the handelsblatt for years, no separate figures for opel from.

According to the document, opel made a loss of 1.1 billion euros in 2008, and the company still expects a loss of billions of euros in 2010. In the first half of the year, the minus in GM’s european business added up to 637 million dollars (501 million euros at the time). The spokesman said that money will continue to be lost in the second half of the year, partly because of the costs of the reorganization.

Opel aims to be in the black next year before restructuring costs. Company CEO nick reilly had repeatedly stated that he would not rule out a return to profitability in 2011. But opel wants to return to the bottom line by 2012 at the latest. To achieve this, reilly wants to get costs under control and reduce capacity by 20 percent. Across europe, around 8,000 of the 48,000.000 jobs are to be cut, and the antwerp plant will be closed or sold.

Meanwhile, parent company GM is enjoying growing demand, especially from north america and asia, and is reporting rising profits. The company emerging from the insolvency of the U.S. Auto giant "new GM", which is currently majority state-owned, is aiming for a return to the stock market this year.

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