Opel withdraws from China: Avoiding infighting with Buick
On March 28, Opel's Chinese distributors were a special turning point. This afternoon was supposed to be the day for General Motors to hold an annual meeting of dealers. However, General Motors urgently announced the news of Opel's withdrawal from China before the annual meeting.
Opel's withdrawal from China is not the reason for sales. Although Opel has sold only 4,000 vehicles in China, Opel’s profitability in China is not pessimistic compared to the losses of Honda Acura and Nissan Infiniti.
According to a dealer of Opel China, Opel averaged a profit of US$ 3,000 for a car, and Opel’s sales team with less than ten people from China’s GM earned more than 100 million yuan a year, which is why GM China has been reluctant to transfer Opel to Shanghai GM. One of the main reasons why the Buick team operates.
However, this time no one can resist Opel's withdrawal because it concerns the implementation of the universal global strategy. After succeeding Exxon in managing general global business, an important task received by GM's current CEO, Mary Bora, is to make products more energy efficient to increase profits. To this end, Bola is carrying out a brand reorganization involving the North American, European and Chinese markets. Opel's withdrawal from the Chinese market is an important part of the Bola New Deal.
Avoid "inside" Buick
Opel in the Chinese market is not the amount can not be bigger, but whether the General Motors or the common Chinese market partner SAIC, do not want to Opel's volume bigger. Although GM has a good profit, it has almost zero investment in Opel's market. Opel's few advertisements are almost entirely invested by dealers.
The reason for prudent investment is that GM does not want to create "infighting" between Opel and Buick. After the establishment of Shanghai GM, it has introduced the Daewoo platform of South Korea, the North American Buick platform and the Australian Holden platform. However, due to the aging of technology, Shanghai GM's sales volume in 2008 was directly reduced.
In 2009, GM implemented the strategic transformation of "European and American technology, global platform", introduced Opel's platform in time, and upgraded its models. Facts have proved that the new generation of Regal, New Excelle, Hideo, and Encore models based on the Opel technology and the GM platform have performed well in their respective market segments.
However, this directly led to the direct competition between Opel products and Shanghai GM products. Regal and Insignia, Hideo XT and Opel Astra, etc., although one imported one is domestic, but the similar products, so that Buick and Opel in the Chinese market into a vicious circle. More and more Opel sales, in fact, is also more to snatch the Buick market.
How Opel develops in China, and GM has been negotiating with its partners. Once Shanghai GM hoped to integrate Opel into Buick's channel and connect with Buick. However, after Saab failed, GM did not want to take the risk again and did not want to abandon the annual profits of hundreds of millions. Since then, when serving as the president of GM China, Gan Wenwei, he had discussed with SAIC that he would set up a joint venture to produce and sell Opel's products. However, this plan came to an abrupt end after the retirement of Gan Wenwei in 2012.
While the strategy of Opel China fluctuates, Buick is becoming more and more powerful in the Chinese market. Buick currently accounts for 80% of global sales in the Chinese market. Instead of creating a competitor for Buick in the Chinese market, it is better to exit. Opel's withdrawal from the Chinese market means that GM has only one Buick brand in China's mid-to-high-end car market, and GM will also devote more resources to the Buick brand.
China lost Europe and America
However, Opel's withdrawal from the Chinese market is conditional. It is worth noting that before Opel withdrew from the Chinese market, there were two major events in the European market where Opel was located. First, in November last year, GM announced that the Chevrolet brand will formally withdraw from the European market in 2017; second, when GM announced that Opel had withdrawn from China, it also announced that it will invest in the production of two Buick models for the US market at the Opel plant in Germany.
With Chevrolet quitting Europe, Opel is GM's only brand in the European market (in addition to the luxury car Cadillac, but the consumer culture in the European market determines that Cadillac will not be the mainstream), and Opel's position in the GM global brand strategy will increase accordingly. With the Buick model produced at the Opel plant in Germany entering the North American market, it means that Opel
Face into North America.
After China's operations were separated from the General International Operations Department in August last year, GM currently has five major business segments in the world, including General North America, General Europe, General South America, General China, and the General International Operations Division in addition to the above four regions. The five business segments are all operating independently and financially accounted for separately.
However, after taking over as general CEO, Bola faced the situation that except for the Chinese market, GM’s price pressures in other international markets have increased dramatically and losses have continued to occur. Sales in the South American market have shrunk and profits have fallen. Although losses have been decreasing in Europe, it is expected that 2014 will face the double test of price cut sales and restructuring costs. Through this strategic adjustment, GM is beneficial to at least three major markets.
Opel's withdrawal from the Chinese market requires the approval of the person in charge of the relevant business unit. Currently, the CEO of Opel is Karl-Thomas Neumann, former president of VW China. Ni also serves as President of GM Europe and vice president of General Motors. He is also a member of the General Motors Executive Committee.
Ni Kaiming, who has witnessed the success of the public in China, absolutely understands the importance of China’s globalization and the irreplaceable status of the Chinese market. Ni Kaiming can agree that Opel withdraws from China is for Opel to obtain greater benefits.
For GM North America, Buick, which is manufactured at the Opel plant in Germany, entered the North American market to make up for the lack of GM's product line in North America and boosted Buick's renaissance in North America.
Buick’s glory in the US market is to be traced back to 1984, when Buick sold 1 million vehicles worldwide. At that time Buick brand's main contribution came from the US market, with sales exceeding 940,000, but due to various reasons, by 1998, Buick The global sales of the brand declined to 431,548 vehicles, less than half of 1984. Buick's sales in the United States are no longer in sight. In 2009, Buick once shrank to 102,300.
As early as 2011, GM’s then-employed CEO, Exxon, planned GM’s brands, which identified Cadillac and Chevrolet as two global brands, and Buick was a brand that focused on North American and Chinese markets. Opel's production of the Buick model into North America is also intended to promote the implementation of this plan.
However, it is not easy for GM to implement this plan smoothly. Whether Chevrolet withdraws from Europe or Opel withdraws from China, it will hurt the interests of its distributors and consumers.
It is worth noting that, while exiting the market, GM has promised consumers to continue the warranty, and dealers will not voluntarily give up after-sales service profits. However, the issue of compensation for dealers is much more complex. In the European market, GM is facing a dealer complaint. A few days ago, the French automobile industry's representative body of retailers, repair shops and service providers, the French National Automobile Professional Committee (CNPA) announced at a press conference that it will initiate legal proceedings against General Motors on behalf of Chevrolet local dealers. . The distributors in the Chinese market are also waiting for GM to give a statement.

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