Opel to exit China; start building Buicks for US

In a statement, the General Motors-owned German brand said: “Opel has decided to change the export strategy for the Chinese market. As of January 2015, sales of the Opel brand in China will cease.”

Described by Opel CEO Karl-Thomas Neumann as a “long overdue decision”, the exit from the world's biggest car market was announced in conjunction with a 245 million euros ($365 million) investment into its Ruesselsheim plant, which will support the production of a second model – the details of which will not be announced until the end of the year due to “competitive reasons”.

“It would have cost hundreds of millions of euros to raise awareness of the Opel brand and to expand the distribution network,” Neumann said.

“Buick, however, is one of the market leaders in China and we plan to intensify our future collaboration, with several projects currently under examination."

The Opel Insignia currently produced at Ruesselsheim shares its underpinnings and some body panels with the Buick Regal (pictured below).

The announcement to withdraw Opel from China is the latest move in GM's restructuring efforts following its decision to pull Chevrolet from Europe by the end of 2015 and cease local Holden manufacturing by the end of 2017.

Claimed to help "pave the way for Opel’s profitable growth", GM president and Opel supervisory board chairman Dan Ammann said the investment in a new, additional model for Ruesselsheim was a further important step in the US company’s multi-billion dollar model offensive.

Opel works council head and supervisory board deputy chairman Wolfgang Schafer-Klu said the expanded manufacturing plan was not only part of its extended growth strategy but also “further evidence of GM’s confidence in Opel”.

According to Opel’s own figures, 22 Opel dealers in China sold a total of 4365 vehicles in 2013, compared with the 810,000 Buick vehicles sold in China by its 650-dealer network.

The latest announcement also confirms reports from late last year that GM would increase the independence of its European-based operations as part of its ongoing efforts to overhaul its global vehicle platforms and stem its European losses.

Opel announced its exit from Australia back in August 2013.