General Motors marked its 100th anniversary on Sept. 16, saying its future lay in China as it broke ground on a research facility that will develop hybrid and electric cars for the Chinese market. The $250 million complex, expected to open by the end of next year, will be home to a research center for developing alternative fuels and cleaner cars, GM Asia Pacific President Nick Reilly said.
The center aims to employ about 1,500 scientists researching hybrid and electric cars, lightweight materials and how to make vehicle manufacturing more energy efficient, Reilly said. "We'll develop things for GM worldwide here, not only for the Chinese market," Reilly said at a ceremony.
China is GM's largest market after the United States. Through joint ventures with Chinese companies, it led the market with more than one million vehicles sold last year -- followed closely by Volkswagen, which sold about 910,000.
China's July and August car sales were weaker than expected but Reilly said he expected the slowdown to be a temporary one attributable to rising fuel prices, a falling stock market and the Beijing Olympics.
He said he expected growth in China this year to be around 11% to 12% and for growth to remain between 10% to 15% for the next five years. "The underlying growth in demand is clear to see," he said. "It's not just in tier-one cities, it's growing even more in tier-two, three and four cities. I would expect that to come back this month, or next, to resume double-digit growth."
He predicted China would be the world's biggest car market within four to six years, contrasting it to the United States and Japan, where sales are expected to increase only one or two percent annually over the next decade.
In addition to the new facility, GM and its Chinese partner, Shanghai Automotive Industry Corp., has set up an automotive fuel research center at Beijing's Tsinghua University to help China reduce its reliance on oil.
To further bolster its green credentials, GM this year released a hybrid version of its Buick LaCrosse sedan in China. Reilly said the hybrid LaCrosse had not sold in huge numbers but it was still "very early days." He expressed hope that Beijing might follow other governments and offer motorists incentives to encourage them to buy hybrids.
GM's Buick is one of the best-known cars in China, with more than 1.7 million owners, according to GM. The name plate has a strong history in China: revolutionary leader Sun Yat-sen and Pu Yi, the last emperor of China, both owned Buicks, according to the company.
Copyright Agence France-Presse, 2008