GM Wows China – But Still Fixing America Page 2

April 23, 2007

2007 Buick Riviera Concept (China)

“By the day it’s more important” to GM, said Wagoner.


The executive said that even as China ’s automotive market grows, he expects to see a further consolidation of its homegrown manufacturers – if for no other reason than government policy.


“That sounds pretty good to me, and we’d like to participate,” said Wagoner. In 2002, the government nudged GM and SAIC into taking over a struggling player based in the southern city of Liuzhou, called Wuling. Today, the partnership, called SGMW, is the biggest producer of microvans in China. MORE—




But GM isn’t the only one with big ambitions. Indeed, at this year’s Shanghai Motor Show, SAIC made some big news of its own. The Chinese company opened the event’s day-long press preview with the debut of its Roewe W2 Concept. Also on display was an updated version of the Rover 75, designs of which SAIC acquired in 2005 from the bankrupt British carmaker. The next stand over featured new products from Ssangyong, a South Korean marque that SAIC also acquired out of bankruptcy.


According to SAIC Chairman Hu Maoyan, the Shanghai-based firm is intent on becoming a significant player in the booming Chinese market on its own, as well as in partnership with Western firms like Volkswagen and General Motors.


For his part, GM’s Wagoner insisted he is not worried about this strange bedfellows relationship. The joint-venture partnership with SAIC, he asserted, “has paid off for us very well,” and even with SAIC fielding its own fleet of products, GM sees little but upside potential. With its share now over ten percent in China, analysts are wondering how much more the U.S. automaker can gain. Wagoner said he doesn’t see any reason why GM couldn’t push well into the teens.


Such growth in China, as well as a new push into India, could prove critical to General Motors at both the practical and psychological level. Many analysts believe the U.S. maker will soon be knocked from its throne as global-king-of-the-hill by Toyota, which recently posted production forecasts that could push past GM by 2008 or ’09. But the boom in those two markets – where Toyota is still a minor player – could keep GM dominant worldwide.


If there are any serious issues that concern GM about China, it’s the controversy over intellectual property rights. A prime example is the Chevrolet Spark, a minicar sold through the SGMW dealer network. It has been cloned by the native Chinese maker, Chery, which by marketing its own QQ about 25 percent below the cost of the Spark, sells four times as many vehicles.


Wagoner said that before coming to Shanghai , he’d met with government leaders in Beijing – officials now facing a challenge by the U.S. government over their failure to protect intellectual property rights, or IPR.


“I suspect, over time, (the issue) is going to diminish,” suggested Wagoner. “As more (intellectual property) is created in China, our interests will align.”


Related Articles


2007 Buick Riviera Concept by TCC Team (4/19/2007)
Live from Shanghai - the future of Buick?


GM Plugs Fuel Cells into Volt by TCC Team (4/19/2007)
Detroit concept gets next-gen power in Shanghai.


Buick Adding Hybrid – In China by TCC Team (4/17/2007)
New LaCrosse greens up brand image.


GM Unfazed by Chinese Partner’s Plans by Joseph Szczesny (11/27/2006)
GM not worried that SAIC will compete directly.


Roewe Takes on China – and VW by TCC Team (4/21/2007)
SAIC steers Rover leftovers upscale in Shanghai.

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