Big deals in the auto industry are rarely about a single vehicle, but to understand the cost pressures that helped prompt General Motors to abandon its European operations, consider the unassuming Opel Corsa subcompact.
A key account manager at a major German supplier believes GM's problems in Europe came to a head with plans for the next-generation Corsa. The current generation, which debuted in early 2015, is built on the same Fiat platform as its predecessor.
If GM were to design the upcoming Corsa on its own to meet European market requirements, it would be too expensive to sell in emerging economies where B-segment cars are popular. Were it designed as a global vehicle, it likely would fall flat at home -- a considerable risk, given it remains Opel's biggest volume model with 264,000 sold last year.
"One of the primary reasons [behind the sale] was GM had to develop a whole new B-segment platform just for the Corsa in order for Opel to meet future CO2 emission regulations," the account manager argued.
A Corsa built off a PSA platform wouldn't have this problem.
PSA's Peugeot and Citroen subsidiaries had the lowest and second-lowest CO2-emitting fleet in the European Union in 2015 (the last year for which official data are available), while Opel came in worse than luxury carmakers Daimler and BMW.
Opel has been burdened by the weight of its vehicles and poor fuel efficiency, a legacy of utilizing either outdated platforms or GM global architectures that cater largely to the demands of U.S. and Chinese customers who prefer large, roomy cars sturdy enough to house big engines.
The European Environment Agency, which tracks carbon dioxide fleet emission targets on behalf of the EU Commission, has warned Opel for the past four years that it is running behind its peers when it comes to meeting its 2021 obligations, since it has to achieve more progress in reducing CO2 over the next six years than it has over the previous six. Later this year, fresh targets for the period after will likely be proposed by the commission.
And in a move that has shocked car executives, the city of Stuttgart, the cradle of Germany's auto industry, plans to ban any diesel vehicles from entering on certain smog-filled days unless they meet the most modern Euro 6 emission standards introduced in September 2015.
"What we saw from a product point of view and a regulatory point of view was a Europe, frankly, diverging from the rest of our global portfolio," GM President Dan Ammann told Automotive News at the Geneva auto show. "The requirements for Europe are becoming more and more unique."