GM says Shanghai plant sales to rise 90%

SHANGHAI December 3, 2002; Jianguo Jiang writing for Bloomberg reported that General Motors Corp. expects sales in China of cars made at its Shanghai venture to rise 90 percent this year as demand for vehicles rises in one of Asia's fastest growing economies.

Shanghai General Motors Co., a 50-50 venture between the world's largest automaker and China's No. 1 carmaker Shanghai Automotive Industry Corp., may sell 110,000 Buick sedans and wagons and Sail cars in 2002, from 58,000 last year, General Motors said in a press release.

Shanghai General Motors increased its share of China's passenger car market to 8.6 percent this year from 3 percent three years ago. General Motors has said it expects car and truck sales in China to rise 42 percent to 3.4 million vehicles this year from 2001 and predicts China will be the third-largest market for cars by 2008 behind the U.S. and Japan.

China's economy expanded 8.1 percent in third quarter from the year-earlier quarter compared with 0.7 percent growth for Japan in third quarter from a year ago.

Shanghai General Motors may expand its annual production capacity to 175,000 vehicles using three shifts from 100,000 units on two shifts now, said Chris Gubbey, the venture's executive vice president. He didn't offer a time.

Shanghai General Motors also expects sales to rise more than half to about 18 billion yuan ($2.2 billion) this year from 11.5 billion yuan last year, said company president Chen Hong. He declined to give a profit estimate. In 2001, Shanghai General Motors had a 809 million yuan pretax profit.