General Motors To Export $US1.3B Vehicles To China
Thursday, November 13, 2003
Available for immediate use
General Motors To Export Vehicles To China
Valued At $US1.3 Billion
Detroit. General Motors plans to export to China thousands of Cadillacs, Buicks and other GM vehicles, valued at about $US1.3 billion, in 2004 and 2005. The exports will be in the form of both complete vehicles and kits for assembly.
Chinese Vice Minister of Commerce, Ma Xiuhong, joined Chairman and CEO Rick Wagoner and other General Motors executives in Detroit to announce the agreement, which makes GM China the first China-based subsidiary of a non-domestic automotive company to sign a vehicle import contract.
The 4,500 complete vehicles that GM plans to export through its subsidiary, GM China, include the Cadillac CTS sedan, SRX luxury utility vehicle, XLR roadster and next-generation STS prestige sedan. With this agreement, the Chinese government has authorised the granting of trading and distribution rights one year earlier than required under its World Trade Organisation obligations.
“As vehicle ownership grows in China, the luxury segment is beginning to open up,” Wagoner noted. “We at General Motors believe that now is the right time for us to introduce our Cadillac luxury brand to China. Today’s comprehensive agreement also indicates the seriousness of our intention to be a major player in China.”
GM also signed two agreements with its flagship joint venture in China - Shanghai General Motors. The first agreement, valued at about $US400 million, is for the supply of components and assemblies for about 13,000 vehicles. The Cadillac SRX and CTS are among the models to be assembled in China; other models or brands have not yet been announced.
The second of the two agreements with Shanghai GM involves the supply of about $US700 million worth of component kits for the Buick Regal sedan and Pontiac Montana-based Buick GL8 executive wagon, which will continue to be assembled in Shanghai.
In addition, GM signed agreements with several independent Chinese importers to import about 1,000 complete GM vehicles into China. The makes and models of vehicles covered by this agreement have yet to be determined.
“The Cadillacs we’ll export will come from our Lansing Grand River facility, one of our best plants in initial quality and implementation of our Global Manufacturing System,” said Gary Cowger, president of GM North America. “It is an example of how globalisation, when built on common manufacturing processes, can benefit operations worldwide.”
Phil Murtaugh, chairman and CEO of the General Motors China Group, also praised the agreement.
“Adding Cadillac products to our broad China portfolio, while expanding the availability of our popular Buick Regal and Buick GL8 models, represents an extension of our strategy to respond quickly to the needs of our customers and to enter segments in which there is strong demand,” Murtaugh said. “With the world’s fastest-growing vehicle market and the rising popularity of luxury vehicles, China has the potential to become a key market for Cadillac.”
Shanghai GM President Chen Hong said, “This is a further demonstration of the confidence GM places in the world-class manufacturing processes and quality in place at our joint venture. With Cadillac’s unique styling, breakthrough technology and unrivalled luxury, we believe the nameplate will follow the lead of Buick and prove extremely popular in China, just like it has in North America.”
GM plans to establish a new, exclusive network in key Chinese cities to sell and service Cadillac products. Sales are expected to begin in 2004.
- General Motors Corp. (NYSE: GM), the world's largest vehicle manufacturer, employs 340,000 people globally in its core automotive business and subsidiaries.
- Founded in 1908, GM has been the global automotive sales leader since 1931. GM today has manufacturing operations in 32 countries and its vehicles are sold in more than 190 countries. In 2002, GM sold more than 8.6 million vehicles, nearly 15 percent of the global vehicle market. GM's global headquarters is at the GM Renaissance Centre in Detroit, USA.
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