GM will drop Chevrolet by the end of 2015 in order to focus its resources on the Opel and Vauxhall brands, which continue to struggle in the European market.
The company said Chevrolet will no longer have a mainstream presence in Western and Eastern Europe, due to the difficult economic climate.
Stephen Girsky, vice chairman of General Motors, said: ‘We have growing confidence in the Opel and Vauxhall brands in Europe. We are focusing our resources in mainstream Europe.’
Sale volumes of Chevrolet vehicles in Europe have hovered around 200,000 cars since the brand was re-launched in 2005.
By closing Chevrolet, GM expects to record net special charges of £460m to £610bn in the fourth quarter of 2013 and the first quarter of 2014.
GM chairman and CEO, Dan Akerson, said: ‘Europe is a key region for GM that will benefit from a stronger Opel and Vauxhall and further emphasis on Cadillac. For Chevrolet, it will allow us to focus our investments where the opportunity for growth is greatest.’
According to Grisky, the decision to drop the Chevrolet brand is not influenced by GM’s partnership with Peugeot: ‘This is done independent of the PSA relationship.
‘Basically (we will) shut away the one per cent share company in Europe. The financial results have been unacceptable.’
Thomas Sedran, president of Chevrolet Europe, said added: ‘Chevrolet’s business results have been impacted by the unfavourable economic environment in Europe.’
According to Autocar, a GM Spokesperson said: ‘The Chevrolet brand has been in decline for a couple of years. This decision has no impact on GM’s focus on Europe and it is 100 per cent behind Opel and Vauxhall.
Thomas Sedran, president and managing director of Chevrolet Europe, said: ‘Our customers can rest assured that we will continue to provide warranty, parts and services for their Chevrolet vehicles, and for vehicles purchased between now and the end of 2015.’
Following General Motors’ announcement, EurotaxGlass’s Group solutions and business intelligence to the European automotive industry has carried out a review of Chevrolet’s residual values across Europe.
The company believes the impact the news will cause will be minimal due to the orderly nature of the market exit.
Dean Bowkett, technical director and chief editor at EurotaxGlass’s Group, said: ‘Our contacts at Chevrolet have assured us that they are planning an orderly close down, over an extended period. This approach will have a minimal effect on the dealer network because the majority are already dual-franchised with Opel or Vauxhall and as such are likely to remain the approved Chevrolet repair centre. We have also been informed that stock levels are already low which will negate the need for any fire sales from the brand during the transition period.
He added: ‘Different countries will react in different ways as the brand has had varying levels of success across Europe. The stronger the brand is in a country the more damaging this news is going to have on RVs
‘Taking into account the assurances from GM, the low volumes and the already relatively low residual values we see only a small impact on residual values in most countries.’