Opel CEO says plan to return to profit remains ambitious

[July 23, 2015]  FRANKFURT (Reuters) - General Motors warned European employees that the Opel and Vauxhall brands were still posting significant losses, and that meeting a goal of returning to profit will be difficult given the crisis in Russia and the euro zone.

Opel had made significant progress in the first half, with a significant improvement in operating income and sales growth in Europe, but more needed to be done.

"Our plan to return to profitability in the course of the next year remains very ambitious. It certainly will not be a walk in the park," Opel Chief Executive Karl-Thomas Neumann said in a letter to employees on Thursday.

Consumer sentiment has been hit by an economic crisis in Russia and by uncertainty about the future of the euro zone, Neumann said.

"We need to compensate for the volume of sales that we lost there in other markets. This means that we will not be able to grow as fast as initially targeted," Neumann said, adding that Opel's performance tends to be more difficult to maintain in the second half of the year.

(Reporting by Edward Taylor; Editing by Arno Schuetze)

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