General Motors to Start Importing China-made Cars in 2011
As Chinese automakers try to enter different markets throughout the world, GM plans to import its own China-made cars beginning in 2011, which would make it the first major automaker to import Chinese cars to the U.S. market.
The news of GM’s plan to import cars it builds in China comes from a GM planning document current circulating among U.S. politicians. The document shows that GM is planning to sell around 17,000 China-made vehicles in the U.S. starting in 2011. It hopes to triple that number to 51,000 by 2014.
The increase in sales, according to the document, is to come from a 50 percent jump in GM’s total sales in the next five years. Even with sales of 51,000 vehicles annually, this will account for only 1.6 percent of GM’s estimated 3.1 million total sales in 2014.
Many of the cars likely to be imported are small cars like the South Korean-built Chevrolet Spark. An industry official said the models imported will be different from any currently built in the U.S. by any automaker. Part of the reason for the small cars will be to meet the ever-increasing CAFE standards recently set by lawmakers. Importing vehicles built in China will also help decrease GM’s manufacturing costs as it approaches the June 1 deadline set by the U.S. government to restructure its operations and decrease its debt.
In addition to beginning to import vehicles GM makes in China, the GM document also shows the company is planning to sharply increase sales of cars it manufactures in Mexico and South Korea and reduce the number built in Canada. Mexico-manufactured vehicle sales would go from 317,763 units in 2010 to 501,316 in 2014 and South Korean-made cars would more than quadruple from 36,967 in 2010 to 157,126 in 2014. Sales of Canadian-built vehicles would decrease to 330,610 in 2014 from 431,610 in 2010.
Right now, the plan is subject to change pending agreements with the UAW. The UAW criticized GM’s restructuring plan because of the envisioned increase of U.S. sales of vehicles manufactured outside the States. “GM should not be taking taxpayers’ money simply to finance outsourcing of jobs to other countries,” read part of a letter from UAW legislative director Alan Reuther.
“We are in dialogue with the UAW, and my view of a dialogue is that it is a good idea to have an open book on all the different subjects,” said GM CEO Fritz Henderson in a media conference call today. “We have a philosophy of building where we sell, and not only do we think that is the right thing to do, but the most profitable thing to do historically.”
Source: Automotive News