Confirms investment of $14 billion through 2018
During a meeting today with media in Shanghai, General Motors CEO Mary Barra discussed the long-term potential of China’s automotive industry and reaffirmed GM’s investment plans for maintaining its growth in its largest market.
Barra and other members of GM’s senior leadership team are visiting Shanghai in conjunction with Auto Shanghai 2015, this year’s leading auto show in China, which begins today.
“China is playing a vital role in GM’s global success in all areas of our business,” said Barra.
China has been GM’s largest market for the past five years and the world’s largest vehicle market for the past six. Last year, China accounted for more than a third of GM’s record global sales.
GM has kept up its growth in 2015. On April 9, it reached 1 million unit sales in China for the ninth consecutive year and the earliest in its history.
According to Barra, GM expects continued market growth of around 6 to 7 percent annually through 2019.
“Rising household incomes have made passenger vehicles affordable to a growing number of people across China,” she said. “And now we are seeing a growing number of repeat and replacement buyers.”
These customers, who currently represent about 30 percent of passenger vehicle buyers, are expected to account for 70 percent by the end of this decade.
Barra added, “Our brands, including Chevrolet, Cadillac and Buick, offer various sizes, styles and price points to meet the needs of buyers who are purchasing a second vehicle or looking to ‘trade up’ to larger or more luxurious vehicles.”
To maintain its growth in China, GM is in the process of investing $14 billion in new products, manufacturing facilities and other key areas of the business between 2014 and 2018.
In 2015, Buick is introducing two new models in China, its largest market. Chevrolet has 10 products on the way in the coming years in its second-largest market. Cadillac, which is one of China’s fastest-growing vehicle brands,Cadillac, which is one of this country’s fastest-growing vehicle brands, will have several new models in China in the next few years. Baojun, GM’s youngest brand in China, is adding a new SUV to its lineup of passenger vehicles this year.
“GM and our partners are investing significantly to expand the manufacturing capacity of Shanghai GM and SAIC-GM-Wuling,” said Barra. “This will allow our joint ventures to keep up with the strong demand for current and future models – and to do so through local production.”
This year alone, GM’s joint ventures are increasing manufacturing capacity by 24 percent. Among the facilities opening in 2015 is Shanghai GM’s new base in Wuhan that is initially building Buick models. By 2018, GM expects to have 5 million units of annual capacity in China.
GM is also expanding the dealer networks for all of its brands, with a focus on central and western China – where the majority of growth is taking place. In addition, it is increasing the scope of its entire value chain, including financing, onboard telematics and insurance.
“GM is fully committed to China, our local partnerships and China’s vehicle buyers,” said Barra. “With our continued investment, we have a very exciting journey ahead of us.”
