General Motors Co. (GM)’s Opel may appoint Karl-Thomas Neumann, the former head of Volkswagen AG (VOW)’s Chinese operations, as soon as this week to lead the German brand’s turnaround effort, people familiar with the matter said.
Opel’s supervisory board plans to vote Jan. 31 on Neumann’s appointment as chief executive officer, and he may take over in March, said the people, who asked not to be identified because the approval is still pending. VW agreed to release Neumann from his contract three months before it expires in June, one person said. Opel and VW representatives declined to comment.
Opel’s strategy chief, Thomas Sedran, a former consultant with Alix Partners, has been acting CEO after GM forced out Karl-Friedrich Stracke last July. Neumann, 51, was passed over last June when VW created a new board position to focus on the Chinese operations and appointed Jochem Heizmann to the post.
Neumann will have no time to waste at Opel. GM wants to break even in Europe by the middle of the decade after losing $17.3 billion in the region since 1999. It plans to cut $500 million in annual costs in Europe in the coming three years, after eliminating $300 million in spending and 2,600 jobs in 2012, mostly through early retirement and voluntary separations.
GM employs 40,000 staff in Europe, with 22,000 of those jobs in Germany. The automaker aims to reduce capacity in Europe by closing a German factory in Bochum as demand for cars in the region shrinks for a sixth straight year.
Neumann previously worked at Volkswagen until 2004, when he left to join Continental AG. (CON) He was ousted as Continental CEO in 2009 after clashing with the German car-parts maker’s largest investor Schaeffler AG. He rejoined VW later that year.
Alfred Rieck, also a former VW executive, resigned from his post as Opel sales chief last week after less than a year in the job.
The European auto market contracted 7.8 percent last year to the lowest in almost two decades. PSA Peugeot Citroen (UG), Renault SA (RNO) and Ford Motor Co. (F) are among automakers eliminating 30,000 jobs in the region to rein in costs.
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