GM says not to change its China operations

Shanghai, February 19 (Gasgoo.com) The proposed $30-billion restructuring plan of General Motors would not impact its China operations, xinhuanet.com reported today, citing the company's local division. GM is still profitable in China's auto market with increased sales.

GM has maintained its leadership position among multinational automakers in China. That makes it possible for the U.S. auto giant to continue developing new projects in China by using internal capital. "China is one of our most important strategic markets. It is vital to GM's global business growth," the struggling U.S. automaker said yesterday in a statement.

GM's business operations in China will not be affected by its U.S. restructuring plan," said an auto analyst in Shanghai. "The company's confidence in China's auto market and its Chinese ventures' profitability will keep GM focused here." GM China sold 111,282 vehicles in January, up 3.3% year-on-year even as China's total auto sales fell by 14.35% y/y last month to 735,500 units.

From 2004 to 2008, Shanghai GM, the U.S. automaker's 50-50 joint venture with China's SAIC Group, made a profit of 19.7 billion yuan ($2.89 billion). Another joint venture, SAIC-GM-Wuling, has maintained its top slot in China's light commercial vehicle sales for three years. The venture reported all-time high monthly sales of 75,168 vehicles in January after its 2008 sales hit 650,508 units.

GM China will launch 13 new models this year. Shanghai GM's product lineup - Buick, Cadillac and Chevrolet - will be among the six brands GM will focus on for the China market. More all-new or upgraded models of the Wuling, Opel, and Saab brands are also scheduled to come on stream in the next few years.

GM is in talks with China's FAW Group to form a joint venture for producing commercial vehicles. The U.S. company will also not make any changes to its ongoing projects in China, including the 2-bln-yuan vehicle-testing ground, OnStar navigation service, and $250-mln GM China campus.