Trying to hang on to its status as the world’s biggest carmaker drove General Motors into bankruptcy just a couple of years ago.
Now, under new CEO Dan Akerson, the company has discovered the joys of small and, according to reports from Germany, is once again trying to offload its European unit Opel (which includes the UK’s Vauxhall).
GM has already reduced its rambling brand line-up in the US to Buick, Cadillac Chevrolet and GMC (ditching horrible Hummers along the way). This helped the company make profits of $4.7bn in 2010.
More crucially, after its years of losses, it enjoys potential tax breaks of a staggering $45bn to be used up over the next decade or so. So the company is awash with investment money, provided it keeps making a profit to utilise the tax breaks.
Down-sizing in the US has been the model then but GM is eager to expand in China where its main operating unit is Shanghai GM, a join venture with Chinese car giant SAIC.
Last year it sold two million cars in China, about the same as the US.
Europe, via Opel, is not such a big priority though. Opel has been loss-making more often than not although at the moment it is said to making money, mainly from its well-received new Astra model.
But GM, in particular its hyperactive CMO Joel Ewanick, sees Chevrolet – or Chevy – as its big hope in the global volume car market. And, one suspects, he would sooner compete with the Astra than market both it and Chevy models, including the new hybrid Volt.
All GM needs, therefore, is a buyer for Opel and, as usual, Volkswagen, currently in the process of trying to finalise a deal for Porsche, is in the frame.
Some commentators say that GM would be reluctant to share its technology with volume car rival VW but it happens the whole time in the motor industry. cars are not primarily about engines but brands these days (as Ewanick well knows).
But the cost of building Opel into a brand that can compete with VW, Ford and Renault on the one hand and the bottom end of BMW on the other would be stupendous, particularly when Chevy (handled mostly by Goodby Silverstein) is clamouring for attention.
And for VW the gain is clear: VW plus Opel would equal the world’s biggest car company (ahead of currently struggling Toyota).
Such things matter in Wolfsburg.