Tuesday June 2, 01:34 PM
GM China 'still expanding' despite parent's woes
SHANGHAI (AFP) - The China unit of automaker General Motors (NYSE: GM - news) continues to expand despite the woes of its parent, which this week filed for bankruptcy, with new joint venture plans still on, an executive said Tuesday.
GM's China business is self-sustaining and does not require financing from the struggling parent company in the United States, GM China President Kevin Wale told reporters.
He said the firm is maintaining its goal of doubling sales to more than two million units annually over the next five years and will "probably need to build another plant in the next five years".
The once-mighty General Motors filed for bankruptcy in New York Monday in a bid to wipe out massive debts piled up over the past decade.
But Wale said the China arm is still in talks with local firm First Automotive Works (FAW) to set up a commercial vehicle joint venture.
"On FAW, we have said previously we are working closely with them on the commercial vehicle project," he said.
"We are still working through the agreements with them... We are moving forward in a positive manner."
He said GM sales in China jumped 75 percent in May from a year earlier to another record monthly high of 156,000 units, mainly boosted by strong sales of minivans eligible for government subsidies.
Its sales in China, which was the largest auto market in the world from January to May 2009, grew 33.8 percent during the five months from the same period a year ago to more than 670,000 units, the company said.
"We are really struggling to satisfy the demand. We anticipate the growth to continue for the next couple of months," Wale said.
GM currently has eight joint ventures in China, including a three-way commercial vehicle joint venture with the country's biggest automaker, Shanghai Automotive Industries Corp (SAIC), and Wuling Automobile Corp.
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