China Approves GM's Registration of Joint Venture Project

09/10/96

Reuters has reported that GM said China's State Council has approved GM's request to register its joint venture project in Shanghai. A GM official said, "The approval was given several days ago. This is an important step forward and we can proceed with the project."

"But this is not the final approval. No-one knows when that will be given. The auto industry in China is tightly controlled by the government," he continued.

GM's joint venture with Shanghai Automotive Industry Corporation will cost $1 billion and includes plans to produce an up-scale car, which will be made in a new plant in the Pudong New Area of Shanghai. GM hopes to start production in the fourth quarter of 1998.

The model produced by the Shanghai factory would compete with models now imported into China, mainly from Japan. Critics have said that the planned model is too large and will cater only to a limited market in China.

Paul Dever -- The Auto Channel