Call made to sell Opel cars in the US

A labour leader at General Motors' unit Adam Opel renewed calls for Detroit to approve the sale of Opel-brand passenger cars in North America as the German business faces a weak European market.

"If we really push it, we could begin selling Opel cars in the US in one to two years," Klaus Franz, head of the Opel works council, told Reuters yesterday.

The brand could succeed despite brutal competition by emphasizing its European design and engineering, he said.

A spokesman for GM in Europe said, however, the company had no plans to export Opel cars to the US.

"The most important reason is the unfavourable exchange rate, but that's not the only one," he said.

"The company has a sufficient number of brands in the US to cover all customer groups, and Opel's US sister-brand Saturn integrates Opel technology and design into its models much like Opel's sister-brand Vauxhall does in the UK," the spokesman continued.

Earlier this month, shares in GM plunged after the company said it would post a first-quarter loss and sharply lowered its full-year earnings guidance due to a slump in sales in its domestic market.

Following recent signals from GM development chief Bob Lutz that he was considering phasing out either the Buick or Pontiac marquee should sales continue to disappoint, Mr Franz said it was the right time for Detroit to launch the Opel nameplate.

"The company has a product range problem in the US, but the fault doesn't lie with the trucks, rather with the passenger cars," Mr Franz said, adding that models such as the Zafira van and the Signum crossover wagon would be ideal for the US market.

Opel rival Volkswagen suffered an operating loss of €907 million in North America last year and doesn't expect to break even any earlier than 2006 due to the strong euro, but Franz said any disadvantages arising from exchange rates would be less problematic for GM than its penchant to hand out rebates of up to $5,000 on its cars.

"The negative currency effects could be largely compensated," Mr Franz said, citing transfer pricing as a means to offset the impact of foreign exchange.