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2 July 2009

China sales for GM continue to rise

Sales in North America may be poor, but beleaguered General Motors Corp. said sales in China jumped 38% in the first half of this year.

GM sold more than 100,000 vehicles a month in China in January-June for a total of 814,442, a record for any half-year, the company said. Strong demand for its minivans and other small vehicles help boost sales. The sales figures compare with sales of 1,094,561 GM vehicles in China for all of 2008.

Strong growth in China and other emerging markets is crucial for GM’s recovery as it works to emerge from Chapter 11 bankruptcy in the U.S. While GM cut jobs and closed plants in North America, it is still expanding in China.

“China’s vehicle market continued to outpace most expectations for growth,” said Kevin Wale, GM’s China Group president and managing director. “We continued to enjoy strong demand for many of our existing products and new models.”

China helped the increase with stimulus policies, such as subsidies for replacement vehicles, and by strong growth in inland cities that lagged behind China’s wealthier coastal areas.

China’s total passenger car sales surged 21% in January-May, to 3.36 million units, while total vehicle sales climbed 14.3% to 4.96 million units, according to industry figures.

Industry wide sales should top 10 million units this year. In 2008, China’s auto sales grew 6.7% to 9.38 million units, the first time growth fell below 10% since 1999.

GM’s minivan joint venture in southern China’s Guangxi province, SAIC-GM-Wuling, continues to grow under government policies aimed at promoting use of more fuel efficient, less polluting vehicles.

SAIC-GM-Wuling sold 524,598 units in January-June, up nearly 50% from the first half of 2008.

Its most popular vehicle, the Wuling Sunshine minivan sold 295,789 units, while sales of the Wuling Rong Guang premium minivan, which launched a year ago, nearly topped 100,000 units. SAIC-GM-Wuling sold 32,056 Chevrolet Spark mini-cars, up 60% over the year before.

For related information, go to www.isa.org/productivity.