GM’s Chinese JV to produce van in Egypt

SAIC-GM-Wuling expands its market reach as automotive sales in China cool

November 22, 2011   by The Canadian Press

SHANGHAI, China—SAIC-GM-Wuling, a General Motors Co. (GM) joint venture, will assemble autos in Egypt from kits made in China. It plans to compete in the same markets targeted by Chinese domestic car exporters.

GM will build its Chevrolet Move in Egypt from vehicle kits produced by SAIC-GM-Wuling, beginning in the third quarter of 2012.

GM Egypt plans to produce about 5,000 Move vans a year. The Detroit-based automaker also sells an imported van, the Chevrolet N200, in Egypt and other African markets.

China’s auto exports are mainly buses, trucks and knockdown kits for assembly overseas, sold by domestic manufacturers to developing countries.

Made-in-China vehicles exported by foreign joint ventures have struggled, largely due to the struggle to keep up with surging local demand.

But lax demand this year in China is spurring efforts to export more to other fast-growing markets, though rising costs for labour and materials are already eroding the price competitiveness of many manufacturers.

Last year, exports accounted for less than three per cent of the 18.3 million vehicles produced in China, far behind South Korea, Thailand, India and Brazil.

But exports rose 57 per cent in Q1 2011, to 454,400 units, according to the China Association of Automobile Manufacturers.

Top export markets include Algeria, Russia, Brazil, Vietnam and Chile.

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