U.S. auto giant General Motors said on Thursday it would largely withdraw its Chevrolet brand from the European market by 2016, citing the "difficult economic situation" on the continent.
GM instead plans to concentrate on marketing its German-made Opel vehicles and its British sister brand Vauxhall, and in coming years push its luxury Cadillac models in Europe.
The decision will weigh on its accounts and lead to net special charges of $700 million to $1.0 billion, between the fourth quarter of 2013 and the first half of next year, GM said in a statement.
"The company?s Chevrolet brand will no longer have a mainstream presence in Western and Eastern Europe, largely due to a challenging business model and the difficult economic situation in Europe," GM said in a statement.
From 2016, GM will sell only iconic Chevrolet models such as the Corvette in western Europe, while it will keep selling the mainstream Chevrolet models in Russia and the Commonwealth of Independent States (CIS), a group of former Soviet countries.
The Detroit-based company said it also planned to market its Cadillac brand more strongly in Europe and "will enhance and expand its distribution network over the next three years".
The extra charges the company will incur this year and next include asset impairments, dealer restructuring, sales incentives and severance-related costs.
The restructuring will "improve the Opel and Vauxhall brands and reduce the market complexity associated with having Opel and Chevrolet in Western and Eastern Europe," GM said.
"In Russia and the CIS, the brands are clearly defined and distinguished and, as a result, are more competitive within their respective segments."
Chevrolet Europe president and managing director Thomas Sedran assured customers that GM will continue to provide warranty, parts and services for Chevrolet vehicles bought until the end of 2015.