November 13, 2003
GM to export U.S$1.3 billion of vehicles to China
Detroit, Michigan – General Motors plans to export to China thousands of Cadillacs, Buicks and other GM vehicles, valued at about $1.3 billion, in 2004 and 2005. The exports will be in the form of both complete vehicles and kits for assembly.
Chinese Vice Minister of Commerce, Ma Xiuhong, joined Chairman and CEO Rick Wagoner and other GM executives in Detroit on Wednesday to announce the agreement, which makes GM China the first China-based subsidiary of a non-domestic automotive company to sign a vehicle import contract.
The 4,500 complete vehicles that GM plans to export through its subsidiary, GM China, include the Cadillac CTS sedan, SRX luxury utility vehicle, XLR roadster and next-generation STS prestige sedan. With this agreement, the Chinese government has authorized the granting of trading and distribution rights one year earlier than required under its World Trade Organization obligations.
“As vehicle ownership grows in China, the luxury segment is beginning to open up,” Wagoner noted. “We at GM believe that now is the right time for us to introduce our Cadillac luxury brand to China. Today’s comprehensive agreement also indicates the seriousness of our intention to be a major player in China.”
GM also signed two agreements with its flagship joint venture in China, Shanghai General Motors. The first agreement, valued at about $400 million, is for the supply of components and assemblies for about 13,000 vehicles. The Cadillac SRX and CTS are among the models to be assembled in China; other models or brands have not yet been announced.
The second of the two agreements with Shanghai GM involves the supply of about $700 million worth of component kits for the Buick Regal sedan and Pontiac Montana-based Buick GL8 executive wagon, which will continue to be assembled in Shanghai.
In addition, GM signed agreements with several independent Chinese importers to import about 1,000 complete GM vehicles into China. The makes and models of vehicles covered by this agreement have yet to be determined.
Phil Murtaugh, chairman and CEO of the General Motors China Group, also praised the agreement.
“With the world’s fastest-growing vehicle market and the rising popularity of luxury vehicles, China has the potential to become a key market for Cadillac.”
GM plans to establish a new, exclusive network in key Chinese cities to sell and service Cadillac products. Sales are expected to begin in 2004.