August 13, 2014 at 1:00 am

GM would see European profits by mid-decade, says Opel brand CFO

General Motors Co.s European chief financial officer reaffirmed goals to be profitable for Europe by mid-decade, as the automaker sees sales improvement in Germany, the United Kingdom and Spain.

Michael Lohscheller, GMs chief financial officer of Opel Group, which manages GMs European market, spoke Tuesday at the J.P. Morgan Auto Conference in New York. He said the company faces challenges in Russia and Turkey. In Russia, GM sells Chevrolets, Opels and Cadillacs; it has reduced inventory in the region with weak demand and slower sales.

For the long-term, Lohscheller said GM believes in the Russian sales market.

GM recently upgraded its European forecast to return to profitability by mid-decade from just breaking even by mid-decade. GM has amassed several billions of dollars in losses in Europe since the late 1990s. Through the first six months this year, GM has lost $589 million pretax in Europe compared to a $266 million pretax loss in the same 2013 period. But $374 million of the 2014 loss is restructuring charges, mostly around closure of its Bochum plant in Germany by the end of the year.

We are clearly on track to return to profitability by mid-decade, Lohscheller said. He would not give a precise year.

GM, with Opel its cornerstone brand, wants to have 8 percent European market share by 2022, up from about 5.9 percent today. In Germany, the company also wants to grow market share from about 7 percent currently to 10 percent by 2022.

We think 8 percent with our portfolio is doable, is a realistic target, Lohscheller said.

The company also wants to boost profit margins to 5 percent by 2022. Opel plans this year through 2018 to introduce 27 new cars, including a new Corsa, new compacts and SUVs, plus 17 new engines.

GMs decision to stop selling most Chevrolets in Europe has worked extremely well, said Lohscheller, who called it a very good strategic decision by the company.

He said 85 percent of Chevy dealers have converted to Opel franchises. GM in December announced plans to stop selling most Chevys in Europe by the end of 2015 to focus on its Opel and Vauxhall brands. The move will help end an overlap between Chevrolet and Opel in Western and Eastern Europe.