By on September 22, 2008

GM’s burning its way through a reported $1b per month. So shelling-out $250m on a new research and development campus in Shanghai is no biggie. And here’s some PC for your PC: a significant part of the new research facility will focus on developing new green and alternative energy technology (whatever green means). When fully operational in 2009, the new facility will employ some 2500 people. And for those of you inclined to say “yeah right,” General Motors’ Asia Pacific President Nick Reilly says any problems in the Chinese market are all in your head. “Reilly attributed the downturn in the auto market to the Beijing Olympics in August, a sharply declining Chinese stock market, and an increase in fuel prices in June,” the GM suit told CNN Money. “But he added that ‘underlying demand is still there.’ Reilly said he expects vehicle sales to return to double-digit growth this month or next. He said he expects China’s auto market to maintain 10% to 15% growth after this year, without elaborating.” Elaboration? We don’t need no stinkin’ elaboration!

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10 Comments on “GM Begins Construction of $250m Tech Center in Shanghai...”


  • avatar
    Redbarchetta

    He said he expects China’s auto market to maintain 10% to 15% growth after this year, without elaborating.

    This statement came from a guy who works for a company that said the US auto market would be strong again and the housing market would be on the up swing by 3rd quarter 2008. I would sure count on their predictions being right. I don’t think the Chinese market is going to have unprecedented growth until their economy is not so tied to selling us crap, since we sure can’t afford to buy it.

    I think the problems are just in his head as in a lack of grey matter. Looks like a common problem for GM execs.

  • avatar
    Redbarchetta

    It just hit me they are investing this money in China. What happen to investing in the US, keeping jobs here, advanced development for our economy, and all the other sh*t to get our tax money. Sounds like we will be paying for jobs and technology to go to China, typical.

    EDIT doesn’t like me again, said I didn’t have permission to edit my own comment.

  • avatar
    Raskolnikov

    This Tech center is not supposed to displace the Warren Tech Center outside of Detroit, and hopefully it doesn’t.
    But why is this surprising? GM is a huge GLOBAL corporation, just like Toyota.
    Toyota has tech, design and production facilities all over the globe. Should they be only investing in Japan, keeping jobs in Japan, advanced development for the Japanese economy, and all the other sh*t to get Japanese tax money?

    Didn’t think so. Go where the market is.

  • avatar
    jaje

    Is this design center for cars designed for the Chinese market or is it a very upfront and lame attempt to shift jobs overseas for lower pay? If it is the latter this should be quite a problem if they are asking for a bailout – b/c if they do get a bailout (even if they put restrictions that the money given can’t be invested x% overseas to outsource jobs) it frees up their own cash to do so (good ole shell game).

  • avatar
    Raskolnikov

    jaje–from what I hear its the former.

    But if you think about it, GM is offering voluntary separations to white collar workers all over the country, including Warren Tech Center. Will they hire people in China to do these jobs? I don’t know. But one thing is certain, this should tell us that they see China becoming a much more important market.

    If this bothers you, then go buy a Malibu and maybe GM will be incented to keep more engineers here in the US. Just saying….go where the market is.

  • avatar
    netrun

    @Raskolnikov

    That’s all fine, but these same “global” companies are asking the US taxpayer for a bailout. Can’t have it both ways. If you want a US bailout to save US jobs, that’s one thing. But a US bailout to support 2500+ Chinese jobs is crazy.

    NO BAILOUTS!

  • avatar
    John Horner

    This is where the argument that patriotic ‘mericans should buy Detroit branded cars because the profits and white collar jobs stay in country falls apart. GM is dis-investing in the US and investing in China. How does that help the workers of Michigan, et. al.?

  • avatar

    It helps because the profits made in China (and globally) come back to the US (only to disappear in GM’s black hole here, sadly).

    Microsoft, McDonalds and a huge number of other American comapnies do business globally and invest globally while bringing the profits home. That’s the entire point of doing business globally. That’s why Toyota roosts here, to take our green back home and reinvest it there, here and elsewhere. It goes both ways and that’s how businesses profit.

  • avatar
    Cicero

    It helps because the profits made in China (and globally) come back to the US (only to disappear in GM’s black hole here, sadly).

    Microsoft, McDonalds and a huge number of other American comapnies do business globally and invest globally while bringing the profits home. That’s the entire point of doing business globally.

    I think it’s misleading to say that profits of U.S. companies doing business overseas come “home” to the U.S. Profits go into the pockets of shareholders. Those shareholders can be Americans, but they are just as likely to be Europeans, Middle Easterners or Asians.

    This is where the “domestic” brands’ “Buy American” argument comes apart. What makes GM “American” and Toyota “Japanese”, besides heritage and headquaters location? They both manufacture globally and they both have shareholders — owners — all over the planet. I don’t know the actual statistic but I wouldn’t be surprised if Americans own more Toyota shares than Japanese nationals do.

    In this light it’s difficult to rationalize why GM, Ford and Chrysler have a better claim to taxpayer bailout money than would Toyota, BMW or Nissan. The latter three companies manufacture in the U.S. have a significant percentage of American shareholders, just like the so-called domestics.

    This just points out the folly of doling out federal benefits to badly-managed companies on the basis of their headquarters locations. If taxpayer money can’t be used to prop up Toyota (which would be politically radioactive), then there isn’t a good argument for using it to prop up GM either.


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