GM says China partnership with SAIC strong, eyes Indonesia tie-up

Sun Oct 27, 2013 5:36pm EDT
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By Norihiko Shirouzu and Samuel Shen

SHANGHAI (Reuters) - General Motors Co has dismissed speculation its ties with China's SAIC Motor Corp are fraying, saying the partnership is thriving and the two car makers are discussing further collaboration in Indonesia.

Recent independent moves by SAIC outside China had been seen by some industry insiders and experts as signaling the two companies might be drifting apart, but GM's top China executive said it was merely a consequence of its state-owned partner's growing maturity as an automaker.

"The relationship between SAIC and GM has never been better," GM China Chairman Tim Lee said in an interview.

Within China, Lee and GM China President Bob Socia said sales by GM's joint ventures with SAIC and others were likely to grow this year by 300,000 to 3 million vehicles.

Roughly half of the volume would come from no-frills microvans GM produces with SAIC and another partner.

According to the two executives, GM plans to launch more new or significantly redesigned models in China next year, including a key small car update next year. It also plans to further grow exports of jointly designed and produced cars out of China.

To keep up with demand, GM China and SAIC are rushing to open four new plants - two along the country's prosperous east coast and another two in the middle western region of China to add an additional 1 million cars a year to capacity by 2015.

"It's a big bet" with SAIC, Lee said.   Continued...

A man walks in front of the gate of Shanghai Automotive Industry Corp. in Shanghai November 18, 2010. REUTERS/Aly Song