The PSA Group wants to reduce the costs of Opel

Carlos Tavares, Chief Executive Officer of the PSA Group, has announced in an interview possible cuts to the production costs of Opel. According to Tavares, the expenses of the German brand are almost 50% higher than the rest of the brands that PSA has.

Opel will have to present its strategic plan at the beginning of next month, and one of the key points will be the cost problem that Opel poses for the automotive group, such as its high energy consumption.

“Many of the problems are due to the fact that things are out of proportion at Opel, they consume too much energy and the processes are not efficient enough,” Tavares said in an interview published on Friday in the German newspaper Die Welt.

According to the Chief Executive Officer, the Group’s objective is to be much more efficient across all its brands and achieve production costs that are proportionate between them. Tavares has also confirmed that PSA will use its technology and platform design for future Opel models.

In addition, Tavares stated in some remarks that the business strategy that Opel was carrying out was not working and therefore was not profitable for the company. “We will face the danger that Opel will not be able to meet the emission limits that will come into force in 2020. We know that it is serious for the company,” the Chief Executive Officer declared.

The integration process of Opel into the PSA Group after its purchase from General Motors last summer will generate production and even employment cuts. The group has already confirmed that it will cut around 400 jobs at the Vauxhall plant in Ellesmere Port, the British brand also acquired along with Opel.