GM Pledges $5.2 Billion Investment in Opel Over Three Years

General Motors Co. says it will spend €4 billion ($5.2 billion) on plant upgrades and new-vehicle launches for its Opel unit in Europe between now and 2016.

"GM needs a strong presence in Europe," says CEO Dan Akerson, who describes Opel as the "key to our success."

The company's board is holding its quarterly meeting at Opel this week as a show of support for the beleaguered division, which has lost $18 billion since 1999.

The unit aims to become profitable by about 2015. Akerson tells reporters in Germany that GM is "more convinced than ever" of Opel's ability to revive.

The company reiterates that rumors that it might sell the German unit are unfounded.

Opel is banking its turnaround on capacity reductions, efficiency improvements and an array of 23 updated models and 13 powertrains over the next three years. Some of the new product is being co-developed with PSA Peugeot Citroen under the partnership launched by the two companies early last year.