General Motors Corp, the world's largest auto maker, plans to
invest as much as US$5 billion in China over the next five years to
expand its share of the world's fastest-growing major car
market.
The Detroit-based company will spend about US$1 billion a year
on car and engine development, production facilities, technical and
after-sales support and infrastructure, said Kevin Wale, president
of GM's China unit, in an interview in Shanghai on Wednesday.
GM will sell more than one million Cadillacs, Buicks, and other
models in China in 2008, a more than 150-fold increase in sales
over a decade. Toyota Motor Corp and Volkswagen AG both plan to add
production capacity in the country to raise their own sales,
Bloomberg News said.
"Even with this US$1 billion a year, it'll still be tough to
remain No. 1 in China," said Ashvin Chotai, a London-based analyst
for Global Insight Inc. "With China becoming the most important
strategic market in the world, it's crucial to have their
investment to stay in the race."
China's annual economic growth has averaged 9.6 percent over the
past five years, making cars affordable to more people. The
country's total demand will rise to 9.5 million and 10 million
vehicles next year, Wale said.
That compares with sales of between eight million and 8.5
million vehicles for 2007, according to the China Association of
Automobile Manufacturers. The passenger car market will grow 70
percent to 9.2 million vehicles by 2012, according to Chotai.
(Shanghai Daily December 7, 2007)
