Resource for Vehicle News and Information
August 14, 2005

         General motors does in China what it can’t do in the U.S.        

The G.M. management auto model must be: do it right, get asked to leave. The very guy who led G.M. to produce the best selling car in China decided to leave G.M. China after G.M. Detroit reeled in the leash to give more power to Detroit. The formula for success in china was simple; build a $5000 dollar minivan vehicle that gets 43 miles to the gallon. The vehicle is called the Wuling Sunshine and has become the best seller in all of China. The problem at G.M. is G.M. builds cars that the management at G.M. would like to drive. Vehicles like the Hummer H2 and the Corvette Z06 are great, awesome vehicles but they are not for everybody, especially those families who have more then one driver but have to rely on only one car. Mr. Murtaugh was the manager at G.M. China who decided to do something that was completely revolutionary at G.M. He decided that G.M. China should build a vehicle that actual car buyers would want to buy rather then build the super cool cars that the executives at G.M. like to build.

G.M. sold 172,000 cars in China in the first half of 2005 at a profit of $1,000 per vehicle. G.M. World wide sold 3 million cars outside of China during the same period at a loss of $300 per vehicle. G.M. Detroit needs to look at the success in China and search the World markets for niche areas that are neglected by other auto manufacturers but still have enough potential vehicle buyers to reach the economies of scale that you need to achieve profitability.
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