by Jez Spinks

Holden’s German sister brand Opel is exiting the Australian market after less than a year, saying it couldn’t make a profitable business case going forward.

Opel Australia confirmed the news to CarAdvice after a source revealed the brand was planning to cease sales operations in the country.

The company has since made the news official, saying it has commenced plans to wind down its network with immediate effect. CarAdvice understands at least one of Opel’s 20 national dealerships has ceased trading today and has removed cars from its showroom lot.

Opel launched its brand in Australia in August 2012, but with sales not starting until 1st September 2012 – with the Corsa city car, Astra hatchback and Insignia medium car.

CORSA 5 dr front static

Senior management in Germany claimed the company could find 15,000 annual sales by 2015, but Opel has sold only 989 cars to June 2013 – 114 less than niche sports car maker Porsche.

Opel Australia spokeswoman Michelle Lang told CarAdvice the decision to shut operations locally was handed down from Germany this week.

“There are reasons they [Opel Germany] gave us, but there were a set of circumstances in the market we were launching into when when we did the business case last year – the goalposts got completely moved.

“The segments we need to be selling our volume into are so incredibly competitive now, and that’s what changed in a way that’s invalidated the entire business case. We don’t see those changes as being sustained, and [Opel Germany] does, too.

“We’ve had to reposition cars, particularly the Astra, to such a degree that we’re just not going to be profitable. Regardless of volume, it’s a question of profitability and sustained profitability.”

The Astra was Opel’s biggest hope to help the brand establish itself in Australia, as a nameplate familiar to Australians having been a rebadged Holden for decades.

Opel Insignia OPC

Lang says there’s no definitive timing for the operations wind-down, but adds that Opel Australia is working closely with employees, dealers and suppliers as it begins the process.

Opel Australia says customer obligations will be met, and the customer assistance centre can be contacted on 1800 993 677 for help with any concerns.

Opel is now working with Holden to see if any of the German brand’s models have the potential to become rebadged as a “Holden-badged niche product”.

The company was due to launch the Opel Zafira people-mover next week as part of plans to expand the range but has understandably cancelled the event.