GM has 12 joint ventures, two wholly owned foreign enterprises and more than 35,000 employees in China.
General Motors is increasing the development of electrified vehicles in China, the company’s senior technology leader said during a speech in Beijing. In September 2011, GM China opened the Advanced Materials Lab in Shanghai, which is part of the GM China’s sprawling Advanced Technical Center, to research battery technology and lightweight materials. (See GM China Begins Building and Testing Advanced Batteries)
This is the result of a deal between SAIC Motor Corporation and GM for the co-development of a new electric vehicle in China, which has global implications for GM employees and shareholders. Communist Chinese industrial policy requires local partners as a condition of access to the market. Shanghai GM and SAIC-GM-Wuling, the companies’ manufacturing joint ventures, are sales leaders in China, the world’s largest auto market. In addition, SAIC and GM operate a joint venture in India and SAIC is an investor in GM Korea. (See GM and SAIC to Develop New Electric Vehicle in China with U.S. Taxpayer Supported GM’s EV Knowledge and Technology)
Earlier this month at Auto Guangzhou 2012, Shanghai GM introduced the Sail Springo, a pure electric vehicle based on a minicar, which will be built and sold for RMB 258,000 in China. A Chevrolet Spark variant will be built in Korea and sold in the U.S. Springo was developed by Shanghai GM and the Pan Asia Technical Automotive Center, making it the first production electric vehicle created by a Chinese joint venture.
“Greater adoption of electrified vehicles requires a greater breadth of offerings.” And price reductions…
“China has made electrification a key strategy. Electrified vehicles will play a critical role in efforts to conserve and ultimately displace petroleum as the major source of transportation energy,” said Jon Lauckner, GM Chief Technology Officer yesterday in Beijing.
GM’s goal is to improve the energy density of its batteries so that they are smaller, lighter and less costly than today’s batteries. In the long term, the automaker believes there is potential to double the energy density of battery packs in electric vehicles.
However, the globalization strategy in full use by the auto industry is increasingly under attack as U.S. unemployment is to stay above 8% for years to come as deficits soar. Even once staunch “free market” defenders, such as GE’s chairman Jeffry Immelt and the head of Obama’s jobs council, are having doubts as they observe the longer-term negative results of offshoring, which increasingly include GE’s dancing to a Chinese called tune. (See More Jobs to China as GM Will Develop a New Global Engine Family with SAIC and Pan Asian Technical Center)
Due to a combination of tariffs and incentives for locally produced Chinese vehicles – at the core of China’s job creating industrial policy – the Michigan built Volt (more than $40,000 in the U.S. without government incentives) will be at about a $19,000 per hybrid disadvantage, in China, which is not good news for UAW employees who build the Volt in Hamtramck.
“Greater adoption of electrified vehicles requires a greater breadth of offerings; cost reductions in technology for more competitive pricing compared to conventional vehicles; and, of course, more infrastructure for convenient charging,” Lauckner said.
GM’s global strategy is to provide consumers a variety of choices through a range of vehicles with electrified powertrains. Its strategy includes:
- Mild hybrid technology such as the eAssist system, which can improve fuel efficiency in anything from small cars to full-size cars and luxury sedans.
- Full hybrid technology such as the 2-mode hybrid system on full-size trucks and SUVs.
- Extended-range electric vehicles, which offer electric propulsion and contain an on-board gasoline engine generator to extend the vehicles’ range.
- Pure electric vehicles, which run on full electric propulsion.
