Fully Electric Corsa, Arriving in 2020, Announces Opel’s Intention To Electrify Everything

1 week ago by Mark Kane 26

The PSA Group, after its acquisition of Opel/Vauxhall, has announced the PACE! strategic plan for the company – with profitability and electrification in mind.

Opel/Vauxhall Go Profitable, Electric and Global with PACE! strategic plan

The main goal is to make Opel/Vauxhall great again profitable again – with at least 2% automotive recurring operating margin by 2020.

Secondary to that, all new models from the company are promised to have “electrified” versions, making Opel/Vauxhall a “true CO2 leader”.

By 2020, Opel/Vauxhall intends to offer four passenger carlines with plug-in option – including the:

  • Grandland X PHEV (see announcement)
  • next generation Corsa – as a fully electric vehicle (ICE in 2019, BEV in 2020 – although with no stats on that all-electric vehicle as of yet)

By 2024, all Opel/Vauxhall passenger cars on the market will have all-electric or plug-in hybrid version.

In addition, over the coming years Opel/Vauxhall will be step-by-step be switching from GM platforms and power-trains to PSA platforms and power-trains – a decision that is easy to understand, especially in light of GM’s apparent price-gouging Opel on the all-electric Ampera-E when it turned out to be popular in Europe.

The number of platforms used by Opel will decrease from 9 to 2 (CMP and EMP2) to make the profitability possible.

Plug-in Opel Grandland X coming soon!

Opel Design preview

Opel/Vauxhall Go Profitable, Electric and Global with PACE!

•    Return to profitability by 2020: 2% automotive recurring operating margin, positive operational free cash flow 1
•    Lower financial break-even point to 800,000 vehicles
•    Electrification and CO2 leadership: All passenger carlines to be electrified by 2024
•    Improve efficiency towards benchmark levels for manufacturing and logistics cost as well as for wage cost/revenue-ratio
•    Intention to maintain and modernise all plants and to refrain from forced redundancies
•    R&D centre in Rüsselsheim to become a global competence centre for Groupe PSA
•    Enlarge commercial scope: Leverage Opel brand for overseas export opportunities and foster growth of Opel/Vauxhall LCV business
•    PACE! execution to immediately unleash Opel/Vauxhall performance and pave the way to a sustainable future

Rüsselsheim.  Michael Lohscheller, CEO of Opel Automobile GmbH, today announced the strategic plan PACE! to restore financial fundamentals and enhance sustainable competitiveness and growth. All PACE! initiatives will contribute to the goals of generating a positive operational free cash flow as well as a recurring operating margin for the auto division of 2% in a first phase by 2020 and of 6% by 2026. Combining strengths will unleash annual synergies on Groupe PSA level of €1.1 billion by 2020 and €1.7 billion by 2026. All actions will contribute to a lower financial break-even point for Opel/Vauxhall of 800,000 vehicles, creating a profitable business model whatever the headwinds may be.

2017 Opel Grandland X

Having full access to Groupe PSA technologies, Opel/Vauxhall will become a European CO2 leader. By 2024, all European passenger carlines will be electrified – offering a pure battery electric propulsion or plug-in hybrid version alongside efficient internal combustion engines. By 2020, Opel/Vauxhall will have four electrified carlines on the market, including the Grandland X PHEV and the next generation Corsa as a fully electric vehicle.

The company will enhance its competitiveness by 2020 e.g. by reducing costs by €700 per car. Efficiency of marketing expenses will be improved by more than 10%. Overall efficiencies will be increased by reducing complexity across all functions with a ratio G&A/revenue moving from 5.6% to 4.7% and an objective to bring the company towards industry benchmark in terms of wage cost/revenue ratio. Optimising R&D and CapEx at 7-8% of automotive revenue, manufacturing and administration processes by 2020 and releasing working capital of €1.2 billion by 2022 will also contribute to seizing synergies.

Improved competitiveness of the manufacturing plants will lead to new vehicle allocations that will provide a better utilisation rate for the next decade. The two Groupe PSA platforms CMP and EMP2 will be localised in all Opel/Vauxhall plants. To start with, an EMP2-based SUV is planned for Eisenach in 2019; and an EMP2-based D-segment vehicle is coming to Rüsselsheim. The allocation of new powertrains in Opel/Vauxhall manufacturing sites will accompany the shift from GM to Groupe PSA engines and transmissions.

“PACE! will unleash our full potential. This plan is paramount for the company, to protect our employees against headwinds and turn Opel/Vauxhall into a sustainable, profitable, electrified, and global company. Our future will be secured and we will contribute with German excellence to the Groupe PSA development. The implementation has already started with all teams eager to achieve the objectives,” said Opel CEO Michael Lohscheller.

The plan is designed with the clear intention to maintain all plants and refrain from forced redundancies in Europe. The necessary and sustainable reduction of labour costs shall be reached with thoughtful measures such as innovative working time concepts, voluntary programs or early retirement schemes.

All new Opel/Vauxhall vehicles will be engineered in Rüsselsheim, which will be transformed into a global competence centre for the whole Groupe PSA. First areas of expertise are identified, e.g. fuel cells, certain automated driving technologies and driver assistance developments. This will further guarantee German engineering quality and affordable innovations. Altogether, the number of platforms Opel/Vauxhall uses for its passenger cars will be reduced from currently 9 to 2 by 2024. Furthermore, the powertrain families will be optimised from currently 10 to 4.

“Aligning architecture and powertrain families will substantially reduce development and production complexity, thus allowing scale effects and synergies, contributing to overall profitability,” said Lohscheller.

Opel/Vauxhall will switch to efficient and flexible Groupe PSA vehicle architectures faster than originally expected. From 2024 onwards, all Opel/Vauxhall passenger car models will be based on joint Groupe PSA architectures. Next to come are the Combo in 2018 and the next generation of the bestselling Corsa in 2019. This course will be steadily continued with one major launch per year. Counting every body style, Opel/Vauxhall will launch 9 new models by 2020. This line-up will enable to increase the pricing power of Opel/Vauxhall brands and reduce the gap against benchmark by four points.

Sales growth of the further profiled and strengthened Opel/Vauxhall brands will be supported by initiatives like the start of even more attractive financial offerings as well as full service leasing offers via the Financial Services of Opel and Vauxhall.

Furthermore, Opel will enter more than 20 new export markets by 2022. Beyond that, Opel will explore global midterm overseas profitable export opportunities.

To foster growth in the financially attractive light commercial vehicle (LCV) business, Opel/Vauxhall will launch new models and enter new markets with the clear goal to increase its LCV sales by 25% by 2020 against 2017.

“PACE! has been designed by Opel/Vauxhall for the benefit of our employees as an immediate performance booster,” said Lohscheller.

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26 responses to "Fully Electric Corsa, Arriving in 2020, Announces Opel’s Intention To Electrify Everything"

  1. Benz says:

    “Furthermore, Opel will enter more than 20 new export markets by 2022.”

    Are China and the US among those new export markets?

    1. GM will need to duplicate Tesla and open a auto factory in the EU, to become world auto company again and not just a regional player.

      1. Benz says:

        Is your reply an answer to my question?

        My question was regarding Opel entering more than 20 new export markets, and if China and the US are going to be among those new markets.

        And you reply is that GM will need to open an auto factory in Europe.

        The subject of my question is Opel.

        The subject in your reply is GM.

        Your reply is not an answer to my question.

    2. wavelet says:

      From the details given of the PACE plan for Opel (most of which has nothing to do with EVs in the nearfuture), it’s clear Opel will become a sub-brand of PSA, like SEAT is for VW: All their cars will be based on the 2 main PSA platforms (although sounds like they will also be doing some drivetrain R&D for PSA as a whole).
      They are also being put onto an extreme cost-cutting program.
      A.f.a. as entering the US goes: Opels used to be sold with Opel badges in Buick showrooms… Until 40 years ago. Since then, nada, so it’s pretty much an unknown brand in the US.
      It’s highly unlikely PSA will allow Opel, or that Opel would want to, to start a very expensive independent initiative to build a dealer & service network, and make the marketing effort, to sell Opels in the US.

      If anything, it would make sense only if other PSA brands were also sold in the USA, so all could be supported by the same dealer/service network (in particular, Citroën & DS, which could have their own “quirky” cashet).
      As a matter of fact, PSA does have plans to return to the US, after a decades-long absence, but it will be very gradual and start with fleets:
      https://jalopnik.com/peugeot-citroen-plots-return-to-the-u-s-with-unexpecte-1769113351
      So, I suspect that you’ll be seeing Opels in the US only years from now, of at all, as the low-end sub-brand of PSA.

      For those not familiar, although Opel is German, in Europe it does not have any luxury cachet at all. While their cars are considered good quality & reliable, they are definitely low-end; somewhere in between VW’s Skoda & SEAT, and definitely below Peugeot and Citroën.

      A.f.a.

      1. wavelet says:

        Some of the comment got cut off…
        As far as China goes, I’m not familiar with the situation, there’s an existing Opel.CN website from which it looks they’ve already been selling the mainstream models there (Astra, Zafira), so maybe now they’ll be allowed to compete more with the existing GM brands in China.

  2. ClarksonCote says:

    “especially in light of GM’s apparent price-gouging Opel on the all-electric Ampera-E when it turned out to be popular in Europe.”

    Where is there any proof that GM is price gouging Opel? I don’t really understand how that can be concluded lest we know their total cost to produce and import the Ampera-e to begin with.

    Even Opel does not suggest that they are being price gouged.

    1. Benz says:

      Do you have a better explanation for this price increase?

      1. Cavaron says:

        Reason: Taking a financial loss for the green reputation of your own company is ok. Taking a loss for for the green reputation of another company is not.

        Plausible?

        1. Jay Cole says:

          Just my 2p (not speaking for the site, just joining the conversation), but I would say setting a price on the Ampera-E, then seeing 36X months worth of demand out of the gate, and jacking the price by ~$6,500 (USD equivalent) before delivering the first thousand is price gouging.

          PSA agreed to buy Opel before the Ampera-E was first delivered in Europe…so its not a “hey, we suddenly decided to sell Opel, so we need to now equalize the margins on all the offerings we build for them”. It was a long time process coming to an agreement even before the March announcement.

          So, at least to myself, it seems like almost the definition of gouging. Put another way, if no one wanted or was ordering it (like the Volt-based Ampera in 2012), would the price been bumped? No, likely not. More likely would have been the product would have simply been removed entirely from the market as soon as the production run was sold off…as the Ampera was.

          1. Benz says:

            GM doesn’t want their product to be sold as an Opel product any more.

            Every sale of a GM product must increase the sales numbers (marketshare) of GM.

            GM doesn’t want Opel to take the credit from a sale of a GM product.

          2. ClarksonCote says:

            “but I would say setting a price on the Ampera-E, then seeing 36X months worth of demand out of the gate, and jacking the price by ~$6,500 (USD equivalent) before delivering the first thousand is price gouging.”

            As stated, that would be price-gouging. But add in a sale of your European automotive division, and it seems like it’s just bringing the price into line to reflect actual costs.

            Does anyone here think they weren’t selling them for a loss at the price pre-increase?

            If you do think they were taking a loss, then it makes perfect sense that they would increase the price after that division is sold, it doesn’t help them convert competitor customers if you sold the brand.

          3. ClarksonCote says:

            “PSA agreed to buy Opel before the Ampera-E was first delivered in Europe…so its not a “hey, we suddenly decided to sell Opel, so we need to now equalize the margins on all the offerings we build for them”. It was a long time process coming to an agreement even before the March announcement.”

            I think, until a deal is inked, a huge international corporation cannot assume that they sold their brand off. They were proceeding with business-as-usual until the deal was signed, and at that point they provided the volume of Ampera-e vehicles at the agreed-to price. If there wasn’t demand above that contractual level, then no, they wouldn’t increase the price. But since there is, the price will increase to reflect the actual cost.

            Of course, this is just my own 2p as well. If GM was truly making a decent profit at the earlier price, there wouldn’t be a need for them to increase the price, they’d want to find the sweet spot where the price and corresponding supply matches demand.

            So I would say there’s no way they’re price gouging here, with the caveat that I recognize I may not be privy to all the relevant pieces of information. 🙂

    2. ClarksonCote says:

      To be clear, here’s the definition of price gouging:

      “Price gouging is a pejorative term referring to when a seller spikes the prices of goods, services or commodities to a level much higher than is considered reasonable or fair, and is considered exploitative, potentially to an unethical extent.”

      I’m not sure how pricing it such that they don’t take a loss on the vehicle could ever be considered unreasonable or unfair.

      Furthere, there is no other vehicle that has a battery as large as the Bolt with as much range as the Bolt, anywhere near even the increased price.

      On both points, how can a price hike be considered unreasonable?

      I’ll add that I appreciate a healthy debate, it’s not often that I find myself in stark disagreement with Jay Cole. I can only think of once or twice, and the disagreements were much more semantic. 🙂

      1. ClarksonCote says:

        semantic, not pedantic. Darn autocorrect.

      2. Jay Cole says:

        Yupe, we just shooting the breeze…the ‘why’ really doesn’t have a lot of real world value here anyway.

        1. ClarksonCote says:

          Imagine a world where people could disagree on something on the internet while still respecting the other person, without flaming and cursing the other person out.

          What an internet utopia that would be! 😉

  3. TomNorway says:

    People who ordered the Opel Ampera E in Norway in January for equivalent to USD 40,000 got a message in the summer from Opel: “As we are delayed with the production/delivery you are getting a 2018 model. Therefore we increase the price with USD 2000, and the car will be a little bit better”. And just a week or so ago the people who ordered (approx 3000 in Norway) got a new message: “Because PSA has bought Opel, you now have to pay USD 5,421 more on top of the extra USD 2,000 increase!

    The buyers are furious and many will go away from the contract, which Opel opens for, and probably wants them to, as it is kind of Chevrolet’ish or something.

    The Norwegians, which normally are pretty calm, are planning law suits, but know they have only a slim chance because of the various contracts.

    Opel, who seemed to do well in Norway has now become public enemy number one in the EV-society in Norway, and are regarded as con-men, Big Capital swines, and more not suitable on writing. They might make/save USD 16,000,000 or so on this short cut, but they will loose hundreds of thousands lost sales in the future. They make VW look like Winnie the Pooh on the scale of Greed.

    If the same would have happened in France, all Opel windows in shops would be filled with eggs and screaming to the employees. In Norway, people are writing in forums, and go and carry the grudge for 50 years instead. People who could have gotten in line for a Hyundai Kona for example…who has 6000 in line in Norway….

    1. F150 Brian says:

      Sounds like spoiled children who didn’t get the Christmas present they asked for.

      Remind me how much money they lose when they decide not to purchase the Ampera?

      1. Ricardo says:

        You’re probably American and saying others are spoilt children. Ahahahah.

    2. Bill Howland says:

      I guess I’m going to part company with Jay Cole and ssy this is a reasonable increase in price.

      After all MUSK did raise the price of the roadster after his hostile-takeover of Tesla from $89,000 to $109,000 – a $20,000 increase for the bare bones model.

      This increase is much much less in absolute terms and less percentage wise – plus apparently if ‘deposit holders’ don’t want to pay extra, they’ll get their refund, whereas TESLA in the ROADSTER’s case DID NOT OFFER THE OPTION OF A RETURN of the $5000 deposit.

      So in my view, this is a much more fair developement.

      Now Mr. COle’s argument that the final price is too high to be a ‘good value’, will of course be argued in the courts. But it may be that the tens of thousands of reservationists buy the car at the higher price anyway.

      THE GOOD THING is that, since the car is now CERTAINLY profitable for both GM, and PSA, they’re certain to have many copies of the Ampera-e available.

  4. Joe says:

    Corsa EV will use the same platform as the new 208 and probably same electric drivetrain (115ch) and battery (50kWh)

  5. Tom says:

    If they are going to switch to electric, doesn’t that sort of imply continued purchase of drivetrains from GM?

    1. Benz says:

      Certainly not.

      GM is not the only one on the planet who could deliver them.

    2. Priusmaniac says:

      The drive trains are made by LG, GM just makes the box and badge.

  6. Priusmaniac says:

    In other words they will perhaps have the equivalent of a Zoe in another 3 years. In the mean time the Zoe has been available for several years now. Unless cancelled or suddenly unavailable and with a big price increase like the Ampera-e (Aka Bolt). And even if left available that will still not give a normal sedan sized ev car, just yet another mini car like the golf, I” and alike. So we are back at Tesla Model 3, perhaps the Hyundai Ionic as only serious offerings.

  7. Terawatt says:

    It’s a small car, but if they give it range befitting its time and a good price it could be popular – lots of people in Europe drive small cars, and the Corsa is a decent product.

    PSA however isn’t in a position to spend much to position itself for the long term – so I think this will more likely be around 40 kWh than 60 kWh. If it matches the ZOE ZE40 on price and range and comes with DCFC I still think it can grab a good share.

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