Sign in Subscribe
Automobile industry

General Motors to Launch Hybrid Cars in China from 2008

Strategic Insights

— 1 min read

General Motors, in collaboration with its local partner Shanghai Automotive Industry Corporation, plans to launch hybrid cars in China from 2008. This move follows Toyota and Volkswagen's announcements of similar plans for the Chinese market. Industry analysts expect China to play a significant role in the development of alternative energy vehicles, driven by the country's growing energy needs and lack of extensive gasoline infrastructure. GM's CEO, Rick Wagoner, sees great potential in the Chinese market, with the company's sales in China growing at 36.7% in the first three quarters of the year.

Key Takeaways:

  • General Motors will begin selling hybrid cars in China from 2008, in collaboration with Shanghai Automotive Industry Corporation.
  • The company has reduced the cost of making its hydrogen fuel-cell Sequel car by 12 times over the last five years.
  • GM aims to reduce the cost of the Sequel by another seven times to make it commercially viable.
  • The company's sales in China have grown at 36.7% in the first three quarters of the year, cementing its position as the second-largest carmaker.
  • GM is considering using China as an export base for making cars for developed markets.
  • The company is confident of reaching a deal with Delphi, its ailing former subsidiary, and its creditors over labor costs.

Statistics:

  • General Motors' sales in China grew at 36.7% in the first three quarters of the year.
  • China's auto market is growing at around 20% a year.
  • The cost of making the Sequel car has been reduced by 12 times over the last five years.
  • GM aims to reduce the cost of the Sequel by another seven times to make it commercially viable.
  • GM's contribution to a deal with Delphi is likely to be at the lower end of the $6bn-7.5bn range.

Sources:

  • [Geoff Dyer, "General Motors to Launch Hybrid Cars in China from 2008", Financial Times]
  • [Rick Wagoner's statements during a visit to Shanghai]
  • [Shanghai Automotive Industry Corporation]
  • [Delphi Corporation]
  • [General Motors Corporation]

Read more