Opel Rethinks Pricing Strategy

General Motors Co.'s Adam Opel unit, which has been trying to move its namesake brand upmarket, has reversed course and plans to lower its prices instead.

CEO Karl-Friedrich Stracke tells Automotive News Europe Congress that the brand tried to shift its image too quickly. He says Opel needs to return to its mass-market roots to regain its traditional customer base.

Stracke says GM won't reduce its investment in new products for Opel despite the European auto slump. Stracke notes that some of the company's key competitors are cutting product development spending. Fiat SpA announced last week that it was slashing its capital spending in Europe this year by €500 million and delaying several vehicle launches.

GM and PSA Peugeot Citroen, which formed an alliance in February, plan to unveil a platform-sharing program by year-end, according to Stracke.

The partners have said they expect to develop at least four small and midsize vehicle platforms by 2016. New reports have speculated that the next-generation Opel Zafira MPV will be built at a PSA plant. Opel is expected to make the next version of the Citroen C5 midsize car at its factory in Russelsheim, Germany.