Parallel Universe in China for GM for First Half of 2009

By Brendan Moore

07.03.2009

gm-logo-smallThere is no reason to once again detail GM’s troubles in the Western World; they are enduring their own particular nightmare right now in North America and Europe.

Yet, there is a land far away where GM is a colossus, and the future looks limitless.

That land is China, where GM just keeps piling up sales, and the country just can’t seem to get enough of the General. Sales in the first half of 2009 for GM in China jumped 38%. Most of those sales came from minivans and small cars. GM cannot meet demand for some of their vehicles in China, and is still building new production facilities in the country.

GM sold more than 100,000 vehicles a month in China in January-June for a total of 814,442 units going across Chinese curbs for the first half. That is a record for any half-year for GM in China, and is also the Chinese record for six months. Just for comparison, GM sold 1,094,561 units in full-year 2008, which was also a record year. Do the math, and you can see that GM will easily blow past their 2008 record, unless the whole country is hit by an earthquake.

In fact, GM says they will increase the sales of their eight joint ventures in China by 100% from their 2008 total in the next 60 months. That goal appears to be a lock at this point.

The total passenger car sales (including light trucks) in China climbed 21 percent in the January to May period, to 3.36 million units, while all categories of vehicle sales bumped up 14.3 percent to 4.96 million units, according to government and industry figures.

2009-buick-excelle-china

Why is GM so successful in China?

Many reasons, but the main ones are that they got in China early, they stuck with China when others took a break or got out completely, the Buick nameplate is very well-respected in the country, they have good connections in the Chinese government, and finally, they make vehicles in China that the Chinese love.

Amazingly, GM has never put a foot down wrong in China. Ever.

Good thing, too, because they sure need the money at this moment. The Chinese market has turned out to be a godsend for GM during its current troubles.

COPYRIGHT Autosavant – All Rights Reserved

Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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5 Comments

  1. This indeed sounds like a GM parallel universe. Automotive quantum physics run amuck. But I had been wondering about the popularity of Buick in China. Are all those Chinese Buicks made in the People’s Republic, or do we export any from the U.S.?

  2. I had no idea GM was so strong in China. I knew they had a major position there, but I didn’t know they were the Incredible Hulk of China. Amazing. Maybe there’s hope for them yet.

    You know, it wouldn’t hurt GM to have those same reasons for success in China be their strategy in the U.S., right? And to answer Bill’s question, I’m fairly certain all the Buicks sold in China are made in China. Don’t know that for sure but they have the Buick name stuck on a lot of vehicles that aren’t sold anywhere else except China from what I remember. Like vans, little cars, etc.

  3. Made in the U.S. and sold in China? No, and soon GM will be selling cars made in their Chinese factories in the American market.

    They’ve already stated this.

  4. It’s a case of corporate schizophrenia.

  5. GM got it so right in China, so how could they get it so wrong in America for decades?

    Am I the only one puzzled here?

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