General Motors' Exit from Europe

General Motors' Exit from Europe
Case Code: BSTR520
Case Length: 15 Pages
Period: 2013-2018
Pub Date: 2017
Teaching Note: Available
Price: Rs.500
Organization: General Motors
Industry: Automotive
Countries: Europe
Themes: Divestment Strategy, Corporate Portfolio Management, International Management, International Business
General Motors' Exit from Europe
Abstract Case Intro 1 Case Intro 2 Excerpts


General Motors Company (GM) announced in the first half of March 2017 that its subsidiary General Motors Europe (GM Europe) was exiting Europe by selling its European business to French carmaker Groupe PSA (PSA). As per the deal, GM would get US$2.3 billion from PSA. GM said it would concentrate on more profitable markets and products and new technologies like electric cars and fuel cells after its exit from Europe. Analysts felt that GM’s decision to exit Europe would strengthen the company’s profitability and increase the returns to its shareholders. Europe accounted for 10% of GM’s global sales and 18% of its global workforce. The deal would make PSA Europe’s second largest automaker behind Volkswagen AG (Volkswagen). As part of the deal, PSA would take over GM’s Vauxhall and Opel brands, which together produced about US$1.8 billion in revenue in Europe in 2016. GM’s CEO Mary Barra (Barra) said in a statement, “For GM, this represents another major step in the ongoing work that is driving our improved performance and accelerating our momentum...

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