January 27, 2020 GM CEO Mark Reuss announces a $2.2 billion investment in the Detroit-Hamtramck Assembly auto plant in Michigan to create modern all-electric trucks and autonomous vehicles.
Michael Wayland / CNBC
DETROIT – General Motors believes it can regain market share in China after hitting a roughly 20-year low last year amid changing market conditions and increased competition in the domestic market, GM CEO Mark Reuss said Thursday.
A longtime GM executive said modern all-electric and plug-in hybrid vehicles, as well as a redesign of the Buick brand, will support the automaker transform its business in the region.
GM’s market share in China, including its joint ventures, fell from about 15% as recently as 2015 to 8.6% last year – the first time since 2003 it fell below 9%. GM’s operating profits also fell, by 78.5 percent since their peak in 2014, regulatory filings show.
Reuss also touted the competitiveness of GM’s Chinese joint venture partners, such as Wuling Motors. GM began operations in China in 1997.
“You can look at it however you want from a broader geopolitical point of view, but for us in China, the great advantage has been that we have worked so deeply for so many years with our joint venture partners there,” Reuss said at the Financial Times Future Summit conference automotive. “We have an advantage with Buick and Wuling, and it goes both ways.”
GM’s decline in market share in China is the result of growing competition from government-backed domestic automakers, fueled by nationalism, and a generational shift in consumer perceptions of the auto industry and electric vehicles. The company, along with other U.S. automakers, is managing geopolitical tensions between China and the United States
For GM’s U.S. brands such as Buick and Chevrolet, sales in China fell more than those of its joint venture. Joint venture models accounted for about 60% of the 2.1 million GM vehicles sold in China last year.
The market decline has raised questions about whether GM will leave China as other markets have underperformed in recent years.
Reuss said Thursday that GM plans to remain in China “for the foreseeable future.”
GM CEO Mary Barra told investors in February that “nothing is off limits when it comes to ensuring GM has a mighty future to generate appropriate profitability and appropriate returns for our investors” in China.
GM on It was announced on Tuesday “leadership change” in China. The automaker said Steve Hill, currently GM’s vice president of global commercial operations, will replace GM China president Julian Blissett, effective June 1.
