GM exec: China to remain key growth driver for co

China will remain the growth driver for General Motors Co. (GM) due to robust vehicle demand in that country even as the economic downturn continues to weigh on sales in the rest of the world, said Johan Willems, Vice President of Communications for GM International Operations.

GM has forecast sales of 1.4 million vehicles in China this year, a rise of around 200,000 from 2008 levels as incentives offered by the government for small vehicles help maintain consumers' appetite, Willems said.

"In general, the China market is strong and (there are) not a lot of signs that it's going to go away," Willems said late Thursday in Bangkok.

Willems said GM, which has a market share of just over 13% in China, recorded its strongest ever sales for the month of July this year.

"As long as the Chinese government is making money available, people are (buying cars)," he said.

GM, which emerged from bankruptcy last month and has the U.S. government as its largest stakeholder, has shifted the headquarters of its international operations to Shanghai - emphasizing the importance of the Chinese market to its future.

He said China offers enormous opportunities as incomes continue to grow, particularly in the vast number of cities which boast populations of several million people.

"You have to really make sure you're ready and be able to deliver. People don't wait for cars, they buy a car, they want a car," Willems said, adding that GM would need to expand both dealerships and production plants if it wants to achieve its goal of selling 2 million vehicles in China by 2014.

Willems said vehicle sales in Europe remain "under pressure," although there have been some signs of improvement in Germany thanks to government incentives.

Sales in Russia, which reached around 400,000 last year, have collapsed dramatically as a result of the economic crisis, Willems said.

He said sales also remained weak across Europe, particularly France, Italy, Spain and the U.K.

However, he said in recent months there have been signs of improvement in Asia Pacific - with better sales figures in Australia, South Korea, India and Southeast Asia.

"I would say in the last three to four months we have almost every month beaten our own forecasts here in Asia Pacific," he said, but added that "these are not the numbers of China of course."

"The only real exception I would say where everything is really going well is China."