Future Unclear for GM’s Inconvenient Vauxhall Unit
By Andy Bannister
With potential buyers including Fiat, GAZ and Magna-Steyr vying to seize control of GM’s European Opel operations, the intriguing possibility is being raised that such a deal could exclude GM’s British arm, Vauxhall Motors.
Vauxhall and Opel started out as completely separate manufacturing companies in Britain and Germany respectively, both of which ended up as rivals in the General Motors empire. Today Vauxhall is little more than another name for Opel UK, but Britain is commercially very important as it generates the most individual GM sales in any European Union country.
When the disposal of Opel was mooted, most commentators automatically assumed that Vauxhall would be part of the package, but since then speculation has been growing that with those big sales in mind, Vauxhall and Opel could be separated. According to this theory, Vauxhall’s future would lie in co-operation with GM’s Korean unit and with Holden in Australia.
Holden currently provides Vauxhall with its only product not shared with Opel, the VXR8 sedan (a version of which is also the Pontiac G8). Opel doesn’t seem to require its own version of the VXR8, and with the demise of Pontiac, Holden’s export programme has been thrown into some disarray.
For Holden, the prospect of wider exports of the company’s Commodore model to Europe could therefore be very welcome.
Decoupling two closely linked companies is theoretically possible (it happened with Rolls-Royce and Bentley), but in Vauxhall’s case such a move is fraught with problems. If Opel went its own way, would it automatically rebadge all its models as Opels in Britain immediately, potentially leaving Vauxhall Motors with nothing to sell? Equally, who would get the excellent dealer network?
GM Daewoo’s products are already on sale in both Britain and mainland Europe under the Chevrolet badge, reintroduced only fairly recently after considerable marketing effort. Changing future models like the Cruze to the Vauxhall brand from Chevrolet in the UK would make little sense, and there’s no guarantee that current Vauxhall customers would take kindly to a line-up of Korean bargain basement cars, even if the next generation are much improved.
Another complication is the fact that the Vauxhall brand has for many years been unique to the United Kingdom, rendering it as meaningless in other European markets as Opel is in Britain. Its export potential seems to be zero.
The conundrum of the continued and now rather inconvenient existence of the Vauxhall name lies back in history. Back in the 1970s the company still had its own product range and a foothold in some international markets, but was a weakening force. It gradually began to adopt a range of Opel designs, so by the mid-1980s the products of the two companies were largely identical apart from badges.
To Brits, though, the Vauxhall name was important, with a home-grown ring about it which Opel could not hope to match. Opel’s excellent products, fitted with that reassuringly British Vauxhall badge, helped GM to seize a considerable amount of market share from Ford, once by far the biggest player in the UK market.
Vauxhall currently has two plants in the UK, both of which also could be threatened by any deal. Ellesmere Port, in Cheshire, builds Astra hatchbacks and vans, badged as both Vauxhalls and Opels. Ironically, pictures of the latest-generation 2010 Astra have been unveiled this week, including a Vauxhall version.
A further factory in the company’s home town of Luton, Bedfordshire, makes panel vans in a complicated deal with Renault, with the resulting Vauxhall/Opel Vivaro differing only slightly from Renault’s Trafic and Japanese partner Nissan’s Primastar.
Irrespective of any plans are being hatched at GM, if Fiat remains the favourite to take over Opel, it would be understandable for that company to have little enthusiasm for retaining Vauxhall as a separate marque. After all, it has already got a huge amount on its plate with the other deals it is involved in, and is also reportedly considering ditching its own Lancia badge if the Opel deal goes through, so the fate of Vauxhall is hardly centre stage.
On the other hand, potentially surrendering a big share of the British market isn’t attractive either, nor is having to spend large amounts of money to persuade consumers that Opel is a name they can trust.
It’s hard to think of another example of a one-country make anywhere in the world, however, and cold logic says that in today’s market conditions this is an anomaly that is well past its sell-by date. By that reckoning, after over 100 years of existence Vauxhall could soon end up following Pontiac into forced retirement.
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