GM Chinese venture to build $1.23b plant in Chongqing
(REUTERS) - General Motors (GM) Co and its Chinese joint-venture partners said on Wednesday they plan to build a US$1 billion (S$1.23 billion) auto assembly plant in the city of Chongqing as the GM group bids to remain the leader in the world's largest auto market.
GM, SAIC Motor Corp and Wuling Motors Holdings Ltd said they will begin construction of the plant early next year, pending government approvals. The 6.6 billion Chinese yuan (S$1.3 billion) first phase is scheduled to start in 2015.
The plant in southwestern China will have annual production capacity of 400,000 vehicles, but the partners did not disclose what vehicles will be built there. It also will have the capacity to build 400,000 engines annually, a GM spokesman said.
"It's a numbers game," J.D. Power and Associates senior vice president John Humphrey said. "They're doing a phenomenal job, the market continues to grow, vehicle penetration is still so low, gross domestic product (GDP) per capita continues to increase and the west of China is where a lot of the action is going to come going forward.