September 15, 2015 / 12:26 PM / 2 years ago

GM executives stick to Europe profit goal for 2016

FRANKFURT (Reuters) - General Motors GM.N executives said they remained committed to meeting their goal of reaching profitability in Europe by 2016, brushing aside concerns that a downturn in Russia could put their goal at risk.

General Motors CEO Mary Barra and Opel CEO Karl-Thomas Neumann (R) present the new Opel Astra during the media day at the Frankfurt Motor Show (IAA) in Frankfurt, Germany September 15, 2015. REUTERS/Kai Pfaffenbach

“We are confident about reaching our goal,” Opel Chief Executive Karl-Thomas Neumann told journalists at the Frankfurt auto show on Tuesday.

In July, GM warned its European employees the Opel and Vauxhall brands were still posting significant losses, and meeting its goal of returning to profit by next year would be difficult given the crisis in Russia and the euro zone.

But General Motors President Dan Ammann said on Tuesday the launch of a new Opel Astra would help boost sales.

“There’s a lot to love about it and this will support Opel as we move into profitability next year, which we’re absolutely committed to doing,” Ammann told Reuters TV.

“We’re on track. There’s a lot of work to do but we’re on track and we’re gonna do it.”

GM Europe has pared losses in recent months, reporting second-quarter adjusted earnings before interest and tax (EBIT) of $0.0 billion, compared with a $0.3 billion loss in the year-earlier period.

The company’s Opel and Vauxhall brands have benefited from a recovery in European demand which helped raise car sales by 3 percent in the first half of 2015 to 582,300 autos.

Reporting by Edward Taylor; Editing by Georgina Prodhan

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