The Opel Case

THE OPEL CASE

Firm Adam Opel started manufacturing their 4/8 PS model in 1909. That was not their first production model, but that was the car that started the legend about the supreme reliability of the Opel cars, and in fact it was nicknamed “Doktorwagen” because doctors throughout Germany adopted it in mass because it gave them full assurance that it would take them anywhere and in any weather.

In the early ‘20s, Adam Opel was the first German car manufacturer to adopt a modern assembly line and that made it a highly productive firm that conquered almost 40 per cent of the market share.

That triggered the attention of mighty General Motors Group that in 1929 acquired 80 per cent of the Opel stock and then the full 100 per cent in 1931.

Adam Opel survived thru WW II and the Russelsheim plant was fully operative again in 1946 and Adam Opel was in good shape already in the ‘50s. Adam Opel became a major player on the European market when, in 1963, gave life to a little wonder car, the Kadett A

The sub compact car had a neat boxy style, offered good seating to four adults plus generous cargo volume. But the real wonder was its Chevrolet designed 1.0 liter four cylinder engine that was incredibly lively, yet very sober and super reliable in the best Opel tradition. Kadett A quickly eroded the image, and sales, of the then queen of European economy cars, the VW Beetle that enjoyed a largely inflated aura of supremacy in the field because in reality it was poorly handling and its 1.2 liter aircooled flat four was a cheap performer in relation to its pretty high fuel consumption. But still the Beetle enjoyed an incredible reputation that for years had been hard to dismantle. But little Opel Kadett was able to do it, slowly but steadily. From then on Opel enjoyed a solidly growing success. And its image with it. A new generation of SOHC engines proved very efficient and soon showed strong potential, powering various Adam Opel models to winning performances in both rally and track competitions.

In the ‘80s, Adam Opel hired super champion rally specialist Walter Rohrl who drove the Ascona/Manta 400 to victory in the 1982 World Rally Championship. Other Opel models won top laurels in national championships. The Adam Opel image and sales would have skyrocketed to much higher levels provided that the styling of its cars were more refined. But the engines were super, the DOHC 2.0 liter 16 valve unit was unbeatable, on the road and on the racetrack where it dominated also the F3 scene.

But styling was not the real problem, Mr. Jose Ignacio Lopez de Arriortua was. He was hired in the early ‘80s, first as Purchasing Manager and then Production Manager at Opel and then at GM Headquarters in Detroit. He was supposed to be able to cut production costs by some 20%, or at least he had promised. The real problem was that he achieved it mainly by cutting quality and this promptly reverberated on the reliability of the Opel models, the traditional pillar of their success.  Opel image and sales declined dramatically and that was never fully recovered and the strategy to counter this fall was rather erratic by the Opel top management.

GM supreme engineering responded perfectly and immediately restored quality and consistency, but the model range lacked sharpness. Somehow, it seemed that Opel was trying to rebuild its image thru a crash program in which fancy styled sporty models played a major role, which was totally inconsistent since Opel should have focused on a line of solid, functional, versatile family cars. That the SW versions of most models were their top sellers tells all. This sporty run-up policy drained large amounts of energy while never returning the investments. The list of sporty models that Opel created from the 1990s into the mid 2ooos is long and some were excellent. Like the Speedster, a mid engine pure roadster based on the Lotus Elise, powered by the superb Warren 2.2 liter 16 valve four cylinder, a.k.a. Ecotec 2.2, 150Hp strong, and by its 2.0 liter turbo derivative, 225Hp strong. A great sports car, but at the time nobody went to an Opel dealer to buy a 250kph capable pure roadster. The same happened again, with the equally lovely Opel GT, a beautiful roadster based on the Pontiac Solstice and powered by a 265Hp strong 2.0 liter turbo-direct injection version of the Warren 16 valve 4 cylinder. Fast, strong, great handling, great looking, Opel GT sold only 1750 units: another loss for Opel.

In 2008 the big crisis struck and General Motors took into consideration the possibility of selling Opel, just an hypothesis at the time. German Prime Minister Angela Merkel of former DDR was quick at jumping on that hypothesis and started applying pressure on General Motors to force them to sell to some of her friends in former Soviet Union, now Russia. General Motors proudly reacted and cancelled all plans of selling Opel and launched the related plan of investments in order to finalize the reconstruction of the image of the Make. And indeed the effort produced excellent engines, both gasoline and diesel, and in particular the gasoline engines were among the best of the whole European production. Opel also developed high quality chassis capable of very sharp handling quality, safe and very responsive, again among the best of the whole European production. The whole Opel model range was blessed by peasant comfort qualities and by a rather attractive value for money. Yet Opel sales were limping.

In my humble opinion, the cause of this limited success should be identified again in a rather dull styling: low personality front grilles, rear sections that tried to look sporty and that in reality were only less functional. While Opel were struggling to affirm the indisputable technical qualities of their models, Chevrolet were conquering larger sections of the European market. That strengthened the position of General Motors, as a whole, on the European market, but in some cases the models of the two makes were separated only by different styling solutions, and the Chevrolet versions always looked more attractive.

Take the Chevrolet Trax, it looks 10 times tougher than the Opel Mokka, mainly thanks to the stronger personality of its front grill. In other cases it was not a matter of grills only, the Chevrolet Spark was 10 times better than the Opel Agila, from all points of view, and the Chevrolet Aveo might have been a good replacement for the aging Opel Corsa, but I must admit that the Corsa still sells well. Opel styling recovered some in the case of the Adam, a very good looking sub-compact that was available in a very hot S version that was lots of fun, unfortunately it did not sell well, but sure deserved more success. Opel Insignia gained positive respect on the European market, but, again, if you take a good look at its American counterpart, the Buick Regal, you will see that the Regal front grill looks more elegant and with stronger personality.

Enough said. In my humble opinion, in order to recover from the Lopez tragedy Opel only needed to go back to their ultra-reliable standards applied to sensible, solid, functional, good looking cars and, given the evolving market, SUVs. In previous years the Frontera had been a big success to the point of creating very strong ties with its customers who created Frontera Clubs, meetings and events to celebrate it. No need to challenge anyone on the sporty performances domain, but rather on the best performance-to-fuel consumption ratio engines domain, both gasoline and diesel. Opel did that too, but not only, and by pursuing more mundane targets it wasted a lot of precious energies. Staying low profile would have been the most proficient policy in view of a solid recovery. It did not happen. Rather, Chevrolet was pulled out of the European scene in order to grant Opel the best chance to improve their position on the European market.

That was a controversial move: Opel was obviously breathing heavily already, while Chevrolet was an up and coming, young and spirited make that, in addition to the “European models”, would be able to field a line of very attractive and competitive American models. A logic move would have been that the overlapping models would be properly selected. There might be an even more radical, tougher solution: go to the Russelsheim factory, take the Opel sign down and replace it with the Chevrolet one. Mrs. Merkel would not like it, but that would eradicate the problem while keeping the factory fully operative doing Spark, Cruze, Trax and Chevrolet restyled Corsa, Astra (this last one is very good), Insigna (the present one is super even styling wise), and that very smart Orlando, a car that sailed beautifully on a sea without competitors.

And bring in from the States that lovely and super competitive Malibu, the electro Volt and Bolt and the mighty Camaro and Corvette.  It did not work that way. Today, in Europe, GM North America only sells a limited number of Cadillacs, Camaros and Corvettes, and in Russelsheim the sign still reads “Opel”, but they will soon learn to speak French. GM closed its long affair with Opel by selling it to French PSA Group, and the move might be very good for all.

The early signs are very positive and they are called Crossland and Grandland, two crossover that appear well styled, smart, super functional, priced very attractively, and by the test I run, the Crossland also handles very respectably.

They are exactly the kind of functional and versatile cars that Opel needed to put in production in order to rapidly recover from the big credibility crisis ignited by Mr. Jose Ignacio Lopez de Arriortua. They are coming now, a little late, but I am positive that they will produce very very good sales and financial results. PSA Group is led by a very capable CEO, Carlos Tavares, tough, merciless and with a very sharp product strategy in mind.

PSA Group runs very positively making substantial profits every year and improving sales steadily. Their technology is state of the art and particularly advanced  in the domain of Diesel cycle engines. Details of the deal are not fully disclosed, maybe some engine swaps will be necessary, but it seems that the two Groups came to a friendly settling, with GM even granting PSA the access to the OnStar connectivity and safety system for the Crossland and Grandland models.

But now it would be time for GM to bring back on the European market the full line of the Chevrolet models. It might look like an alternating current, on-off policy, but GM cannot stay away from a vital market like this.

In addition, I am planning to buy me a Corvette GS and I need to have a reliable dealer near home to service it.

courtesy of webmatter.de