General Motors Company’s (GM) European arm, Opel, expects to break even in 2011, a year earlier than its previous projection. The unit anticipates its sales volumes to go up by 100,000 units to 1.4 million vehicles next year. The company intends to achieve 5% return on sales by 2016.
Opel is also seeking a partner in the field of fuel-saving hybrid powertrains in order to share development costs for manufacturing gasoline-electric hybrid cars. The company intends to meet the pollution standards of 95 grams of carbon dioxide per kilometer by 2020, mandated by the European governments.
Presently, Opel is banking on its yet-to-be-launched electric vehicle, Ampera that is based on the technology used in Chevrolet Volt. Ampera will hit the market at the end of 2011 at a price tag of €40,000. Opel, which has already received orders of 6,000 Amperas, expects to sell 10,000 units of the hybrid across Europe in 2012.
In the U.S., GM plans to manufacture a luxury electric car dubbed ELR based on the technology used in its Volt plug-in hybrid as well. ELR will be launched under its Cadillac brand as a part of its long-term goal to become a leader in the fuel-efficient vehicles market.
Volt operates as a pure battery electric vehicle until its plug-in battery capacity is depleted, at which point its gasoline engine powers an electric generator to extend the vehicle’s range. It can travel 25 to 50 miles (40 to 80 km) on lithium-ion battery alone. The Volt’s regenerative braking also contributes to the generation of on-board electricity.
This apart, GM also plans to build an all-electric subcompact car under the Chevrolet brand. The automaker has already chosen A123 Systems Inc. (AONE) as the battery supplier for the vehicle and has awarded a contract to the Watertown, Massachusetts-based battery maker. The pure electric Chevy subcompact would compete with Nissan Motor Co.’s (NSANY) Leaf, which was introduced in late-2010.
GM, a Zacks #3 Rank (Hold) stock posted a profit of $2.54 billion or $1.54 per share in the second quarter of the year, which almost doubled from $1.33 billion or 85 cents per share in the same quarter of 2010. With this, the automaker has beaten the Zacks Consensus Estimate by 33 cents per share.
Revenue in the quarter appreciated 19% to $39.37 billion (including $330 million from GM Financial) on worldwide unit sales of 2.32 million versus 2.16 million a year ago, thereby capturing a market share of 12.2%. It also exceeded the Zacks Consensus Estimate of $36.61 billion.
