GM Europe Exec Seeks Improved Margins

GM Europe Executive: Pressure Means Further Cost Savings Inevitable

Tuesday December 12, 11:30 am ET

FRANKFURT, Germany (AP) -- Fierce pressure in the automotive industry has made more cost savings measures inevitable, the president of General Motors Corp.'s European division said Tuesday.

"At a company like ours, you have to reach $500 million per year in overall cost savings" to stay competitive, Carl-Peter Forster said during an industry conference.

Forster said the efficient management of individual brands within one parent company is crucial and described demand for mid-size cars as lackluster, whereas demand for vans, convertibles and coupes has risen in past years.

Automakers "will have to offer a broader variety" of different models to customers in the future, Forster said.

GM Europe posted earnings of $196 million in the first three quarters of 2006 after a $183 million loss a year earlier, boosted by lower costs and higher revenue per car.

"We want to improve our margins further," Forster said. Last week, he said the Zurich, Switzerland-based unit was aiming for higher earnings in 2007 with its revamped Opel Corsa model and rising sales in Russia.

The improvement at GM Europe came after a painful restructuring program including slashing around 12,000 jobs.

Like its parent's operations in the United States, GM Europe faces fierce pressure from competitors.

"The pressure from Asian manufacturers won't ease," Forster said. "Chinese automakers will take less than 10 years in their effort to catch up to international quality standards. They'll be faster for sure."

http://www.gmeurope.com

GM Europe posted earnings of $196 million in the first three quarters of 2006 after a $183 million loss a year earlier, boosted by lower costs and higher revenue per car.

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I believe this includes both Opel and Saab. I wonder what the break down by brand looks like...