General Motors has decided to channel additional financial resources towards making its subsidiary Opel in Germany profitable again. The money is to be used in the development of engine technology.
US auto giant General Motors announced Wednesday it would invest an additional 230 million euros ($299 million) in its struggling European subsidiary Opel headquartered in Rüsselsheim, Germany.
It said the money would be made available over the three to four years and would come on top of the 4 billion euros already pledged by GM for its European operations earlier this month.
The automaker said Rüsselsheim itself and a nearby Opel test site would profit most from the additional shot in the arm by the parent company.
Brighter road ahead?
General Motors said new installations were to accelerate the development of more fuel-efficient engine technology.
Analysts viewed the pledged investments as proof of GM's commitment to keeping Opel afloat despite the carmaker's poor performance in Europe in recent years. The continent's protracted debt crisis had seen its sales plummeting, forcing it to cut overcapacities. Opel's plant in the western town of Bochum will be closed down towards the end of 2014.
GM said it hoped Opel would soon become profitable again. "In Rüsselsheim, we'll in the future also build engines and gearboxes for Europe and the whole world which gives us global responsibility in the development in engine technology," Opel CEO Karl-Thomas Neumann said in a statement.
hg/hc (AFP, dpa, Reuters)