GM's German Unit Establishes Office in China

08/27/96

Have the vagaries of the new world order and the global re-organization of capital got your head spinning? Well don't look now, Reuters has reported that GM's German subsidiary, Adam Opel AG, has set up an office in the southern Chinese city of Guangzhou. The report cites a story published by the China Daily newspaper on Saturday.

The newspaper quoted company officials as saying that Opel is trying to exploit the undeveloped automobile industry in Guangzhou and will seek opportunities to produce vehicles and components in China's booming south.

The move increases pressure on French carmaker PSA Peugeot Citroen Group's joint venture in Guangzhou, where car output has lagged far behind China's other main cities. The Guangzhou Peugeot Automobile Co. went into production in 1986, but has been able to produce and sell only several thousand cars a year.

The China Daily says Opel and other foreign car makers have plans to revitalize the industry and turn the city into an automobile manufacturing center.

China has one of the lowest vehicle density rates in the world, at roughly one car per 700 people. The Chinese Government forecasts that the country's car population will double to 20 million by the year 2000.

Paul Dever -- The Auto Channel