GM offers interest-free loans in China

GENERAL Motors Corp yesterday became the first car maker to offer interest-free loans in China due to increasing competition in the world's second-largest auto market.

Chinese customers buying Buick Excelle or Buick Regal sedans are eligible for interest-free loans after putting a 40 percent down payment, Shanghai General Motors Co, GM's venture with Shanghai Automotive Co, said in an e-mailed statement yesterday. The offer began yesterday, it added.

The move may help Shanghai GM reclaim its position as China's largest car-making venture after it slipped to third place in the first half. At least 30 new or revamped models were introduced in China in the period, forcing auto makers to cut prices and ease financing requirements to maintain sales, Bloomberg News reported.

Shanghai GM had an 8.8 percent market share in the six months ended June, trailing FAW Volkswagen Automotive Co and Shanghai Volkswagen Co according to the China Association of Automobile Manufacturers. The GM venture managed a 13 percent share for the whole of 2006.