GM's Big Sales Goal in China: 3 Million Cars Annually By 2015


General Motors, along with other automakers, may be struggling with sales in a slow-paced domestic market this year. But business is much more robust in China, where GM says sales are so hot, it's on track to sell more than 3 million vehicles there in 2015.

The resurgent company, which posted a $4.3 billion loss last year after emerging from bankruptcy, will add new fuel-efficient models to its China mix to push sales above the 3 million mark, it said Monday. The Detroit-based manufacturer and its partners are already on pace to sell more than 2 million cars this year -- four years earlier than expected, GM said.

Last year, it sold 1.83 million cars in the communist nation. By contrast, GM sales in the U.S. totaled 2.08 million in 2009. To achieve 3 million-plus sales, GM says it plans to introduce 25 new or reconfigured models in China by 2012, and will add more hybrids, and electric and plug-in vehicles during the next five years to raise fuel efficiency.

So far this year, China has been GM's biggest sales market, outperforming U.S. sales for three straight months. Sales there in March rocketed up 68%, to more than 230,000. In the humdrum U.S. market, GM rang up sales of 188,546 in last month, some 18% fewer than China.

"We already have an incredible focus on China and we're going to put as much energy as we can on China," said Kevin Wale, president and managing director for GM China Group, according to AP.

"The U.S. Can't Possibly Retake China" On Auto Sales

China is playing not only an increasing role in GM's plans but in those of the auto industry as a whole. The world's most populous nation slipped past the U.S. last year to become the world's largest single auto market, and is expected to have an increasing role in global automotive design going forward.

Sales are being driven in large part by Beijing's stimulus measures, which include generous tax incentives for purchasing fuel- efficient cars.

"While both the U.S. and China markets are very important for GM, it is China where it will increase investment," Lin Huaibin, a Shanghai-based auto analyst at IHS Global Insight, told Bloomberg News. Huaibin said, "The U.S. can't possibly retake China," when it comes to industry-wide sales.

China's total vehicle sales jumped 72% from a year earlier in the first quarter to 4.6 million units as that nation's economy rebounded from the global crisis, according to the Associated Press. Analysts expect the sales momentum to ebb somewhat in coming months, but total sales in China could hit the 17 million mark this year.

GM's Wale said he expects vehicle sales to surpass 15 million units this year. He said, "If we have a strong wind behind us, we might get to 16 million units for the industry in China in 2010," according to AP.

Some may mourn the end of the era in which the U.S. was the world's largest car market, but GM's plan to develop and sell more fuel-efficient vehicles in China may lead to a greater variety of innovative, environmentally friendlier vehicles available in the domestic market. And that's something we can all look forward to.