Right now, the preparations for the Shanghai World Expo have suddenly turned the entire Pudong district into a huge construction site. Every time from the office on the 10th floor of Jinmao Tower, the vision of General China President Gan Wenwei will always be blocked by the high-rise buildings around him, and they will not be able to see the scenery in the distance.

In the past two years, Gan Wenwei’s main task was how to lead General Motors (a shrinking US auto giant is seeking a rebirth) to find a broader world in China rather than betting all its bets on the SAIC Group. On the body.

FAW Group, which is 1600 kilometers away, has become the next sustenance of Gan Wenwei. On August 31, 2009, General Motors and FAW Group's joint venture "FAW-GM Commercial Vehicle Co., Ltd." (hereinafter referred to as FAW-GM) was announced. The total investment of the project is 2 billion yuan, and each party holds 50% of the shares. FAW Harbin Light Vehicle Co., Ltd. and FAW Hongta Yunnan Automobile Manufacturing Co., Ltd. are two subsidiaries of the joint venture company under FAW. The light commercial vehicle market has become the second battlefield opened by General Motors outside of China's passenger vehicle market.

At this time, GM had already delivered a hot report card in the Chinese market in the first 8 months of 2009 - sales of 1,111,400 vehicles. Among them, Shanghai GM also set a new monthly sales record (Shanghai GM sold 63,303 vehicles in August, an increase of 99.6%). It seems that this has put GM away from the storm in Detroit, United States. But this ever-growing number is only a temporary comfort. In fact, as the president and general manager of GM China, the storm around Gan Wenwei never stopped.

Among them, the biggest flaw comes from the fact that the basis for cooperation between SAIC and SAIC has already shown signs of loosening.

In February this year, on the eve of the reorganization plan submitted by the old GM to the U.S. government, it was widely reported in the industry that GM intends to sell Shanghai GM shares. GM China and Shanghai GM had to issue a clarification statement urgently, denying this irrational rumors.

At the end of March, GM’s former CEO Wagner hung under the weight of the U.S. government and Han Desheng took over the responsibilities of GM. Followed by another report, SAIC or took over the generic Buick brand. The news was also tagged with "rumors" by SAIC and GM.

Another rumors is related to SAIC-GM-Wuling. Although Gan Wenwei repeatedly stated to “Chinese Entrepreneurs,” GM, SAIC, and the Guangxi Provincial Government were satisfied with the current status of SAIC-GM-Wuling (GM, SAIC, and Wuling Group's share ratios of 34%, 50.1%, and 15.9%, respectively). However, according to publicly available reports, GM has not given up its efforts to seek greater bargaining power in this joint venture company, and one of the key steps is to win the support of major shareholder SAIC.

All sorts of troubles are conveying a signal: While GM's headquarters has undergone a rebirth, the undercurrent of all kinds of interests in the Chinese market around General China is stirring up. The expansion of the joint venture with FAW in the field of light commercial vehicles puts the relationship between GM and SAIC more delicate.

A person familiar with the joint venture relationship between the two parties believes that after years of cooperation with SAIC, GM has instead turned to FAW. "Shanghai people are reluctant to take such a reputation." The reason for being able to persuade SAIC to compromise is that it has reached a certain kind of "trick" between GM and SAIC.

When an interview with “Chinese Entrepreneur” was held at the office on the 10th floor of Shanghai Jinmao Tower on September 15th, Gan Wenwei, who was in a whirlpool, had always had a humorous conversation and a gentle smile, as he denied all kinds of speculation. However, Gan Wenwei has to accept a reality: GM China will face a more complex and full of reefs.

Why choose FAW

Sitting on the opposite side of the reporter, Gan Wenwei picked up a ballpoint pen at hand and outlined a pie chart for us simply on a blank sheet of paper. This pie chart is the current Chinese business structure of General Motors. He divided the circle into three, and minibuses and passenger cars filled two of them.

"We have no corresponding business in this block." He pointed the pen point to the blank space in the circle. Immediately, he marked the LCV (Light Commercial Vehicle) in the blank space. This is the most straightforward joint venture given by Gan Wenwei.

"Why is a light truck?"

"Observing the global light commercial vehicle market, China's light commercial vehicle sales accounted for more than 50%. We are very excited about the joint venture with FAW in the field of light commercial vehicles." Daddwick's words are filled with excitement.

Dideway from afar has become the head of the light truck business selected by General Headquarters. For more than 20 years in GM’s work, the skinny man with black-rimmed glasses has served in the commercial vehicle field for 15 years. In his resume, he has worked in North America, Europe, Africa, and Asia. In September 2007, he was appointed Director of Commercial Vehicles Research at GM China, responsible for General Motors’ commercial trucking business in China. After August 31st, his new title was general manager of FAW-GM and was responsible for the production and operation of the joint venture company.

It is not easy for Dydwick to turn FAW GM into another GM cash cow in China. According to public statistics, in 2008, FAW's light trucks sold less than 80,000 vehicles. Moreover, the light truck business is an area that GM is not familiar with and is good at. The light trucks have always been a project that depends on scale to win. This is mainly due to the fact that the profits of light trucks are thinner than that of passenger vehicles. Moreover, light trucks are not easily standardized (light trucks often need to be converted) and their sales channels. dispersion.

According to Sun Muzi, an automotive analyst, the current market size of light trucks in China is about 1.3 million vehicles. Compared with FAW light commercial vehicles, Beiqi Foton’s sales figures are more impressive, while Qingling, JMC and other light truck brands are known for their profitability. This shows that FAW's light commercial vehicle products have no advantage in this segment.

What's more, compared with the performance of multinational companies in the passenger car market, Chinese domestic auto companies have a greater say in the commercial vehicle market. Although in recent years, world-class commercial vehicle companies such as Volvo and Man have come to China for gold rushing, joint ventures in the commercial vehicle sector have rarely been successful.

The bigger doubt is that even if General Motors is determined to make a difference in the light commercial vehicle market, SAIC Motor Corporation also has a light truck program. Why does General Motors approach and seek long?

Gan Wenwei and Daddwey gave the same explanation: “Because SAIC has already owned its own commercial vehicle partners, we have no possibility of cooperation in this regard.” They refer to the partner Iveco Italy . The joint venture company established in 1996, after the reorganization of SAIC and SAIC Group in 2007, was transformed into a subsidiary of SAIC.

“So, what exactly is the general choice and FAW cooperation?”

Dideway explained to “Chinese Entrepreneur” that: First, the two sides will focus on the mainstream of light commercial vehicles in the mainstream of light commercial vehicles, that is, the main cost-performance ratio, which is different from the high-end routes of commercial vehicle joint ventures in the past; General Motors can export advanced management for joint ventures between the two parties. Third, General Motors can provide a convenient international export channel for FAW's light truck exports.

It seems that FAW-GM may be a replica of the SAIC-GM-Wuling model. It is reported that the Wuling brand of SAIC-GM-Wuling is likely to be produced at the GM's Indian plant to achieve Wuling brand's exports. However, the uncertainty is that, as the owner of the “liberated” brand, the strength of FAW is far better than the Wuling Group of Guangxi. Whether FAW-GM's projects can be promoted in accordance with the general will depends on the face of FAW.

Perhaps a more reasonable explanation is that overseas markets are a cake for GM's FAW painting. Sun Muzi believes that for a long time, China's auto exports face two major problems. The first is the adaptation to the target market in terms of safety and environmental protection; the second is the channel, which is divided into hard channels and soft channels. Hard channel refers to the sales network in the ordinary sense, and soft channel refers to related auxiliary measures, such as financial means. This method exists in the aspect of financing, recovery of funds, and avoidance of risks, etc. Its purpose is to enable the company's overseas operations to operate better.

“It takes at least ten years for Chinese companies to complete the cultivation in the above two aspects.” Sun Muzi estimated. But for GM, it is much easier. Regardless of regulations and channels, GM has already formed a strong ability to solve. There is no reason not to make a fuss about exports.

"The final result is the OEM. It is profitable for FAW, but the most profitable is GM. In terms of FAW-GM, GM's control will be much stronger." Sun Muzi said.

The new role of SAIC

Because of many years of joint venture with SAIC, GM’s actions in China are not as comfortable as it seems.

“When we were in contact with FAW, we already told SAIC Motor what we were going to do.” Gan Wenwei said that in the process of negotiations with FAW, GM has been telling SAIC Motor’s progress from start to finish.

This is because SAIC has always been very strong in joint venture projects. "According to SAIC Motor's usual strong thinking, it will not sit back (by joint ventures between GM and FAW)," said an industry official who declined to be named.

This statement was quickly verified. Two weeks after the signing of a joint venture agreement between GM and FAW, SAIC's new trends in the commercial vehicle sector were immediately made public. On September 15, SAIC announced the signing of an agreement to expand cooperation with Italy’s Iveco. The two sides intend to integrate the commercial vehicle resources of both sides in China and expand the scope of cooperation on the existing platform of SAIC Iveco Commercial Vehicle Investment Co., Ltd. It is worth noting that, as early as the merger and reorganization of Shangnan, in January 2007, Nanjing Automobile had already incorporated the Yuejin brand for light trucks into Nanjing Iveco.

SAIC's move could not help but make people think about it: Is this the SAIC Group's response to GM's cooperation with FAW? The answer is unknown.

From a past point of view, SAIC Motor is the most qualified and only collaborator and sharer of the market legend written by General Motors in China.

As the current president and general manager of General Motors of China, after Gan Wenwei took office in May 2005, General Motors surpassed the public at that time and became the king of new sales in the Chinese market. Benefited from favorable factors such as the reduction of purchase tax, the automobile-to-country policy, and the conversion of the Shanghai-based model platform to the European system, GM has ushered in sales in the first eight months of this year.

GM's sales in China not only continued to lead the entire auto market. Compared with the “old” GM of the same period last year, sales increased by 49.6%. General Motors expects that the sales of cars in China this year will reach 1.4 million. This is equivalent to twice the sales volume of Toyota during the same period.

What is out of the question is that SAIC's own brand is not good for 2009. After SAIC Ssangyong went bankrupt to protect itself, SAIC Motor’s attempt to enhance its own brand strength through mergers and acquisitions of SsangYong ended in failure. After the merger and reorganization in the South, MG's market performance has also been tepid. At the moment, SAIC urgently needs to inject new vitality into its own brand.

That is why the events of the Opel platform sales that SAIC and GM have all been extremely close to each other have emerged in this context.

In June this year, domestic media reported that SAIC Motor intends to purchase Opel Insignia's platform technology from GM for SAIC's own-brand Roewe 750 next-generation models. According to people familiar with the matter disclosed to the publication, SAIC and GM have reached a preliminary consensus on the use of the new Regal platform to produce the Roewe 750, which is used to boost the unfavorable sales situation of SAIC Roewe 750.

“We did not sell such a platform to SAIC. There was no concession and compromise between us and SAIC in terms of cooperation with FAW.” Gan Wenwei denied this speculation in a calm tone.

In contrast, the attitude of Chen Hong, president of SAIC Group, has provided people with room for reverie. It is said that Chen Hong was extremely irritated by this report and ordered the suspension of all advertisements of SAIC (including Shanghai Volkswagen, Shanghai GM, SAIC Passenger Vehicle, etc.) in the aforementioned media.

In the existing joint venture between SAIC and GM, the game between the two parties is also constantly happening. Changes in the company's equity surrounding SAIC-GM-Wuling, the joint venture relationship between GM and SAIC once again tangled.

With the increasing importance of the Chinese market, GM hopes to seek greater right to speak in the joint venture company SAIC-GM-Wuling, and to purchase the shares of Liuzhou Wuling Co., Ltd. as a condition of the production of mid-size cars. But there is a strong force that General Motors cannot ignore, that is, the major shareholder SAIC.

Recently, there is news that SAIC and GM will jointly establish an investment company in Hong Kong to jointly manage GM's business in the Asia-Pacific market. This trend has already appeared in the Indian market. SAIC is currently in contact with General Motors on the acquisition of an Indian factory. This is an attractive short-cut for SAIC Motor, which has gone through a setback in China.

From GM's earliest leaders and umbrellas in the Chinese market, to becoming a common competitor in certain fields, Gan Wenwei must now adapt to this role change in SAIC Motor, in order to create a century-old store in the complicated Chinese market. It is necessary to realize the Zen concept of “willingness”.

Balanced play

“We have reason to believe that the cooperation between GM and FAW is far from simple to produce and sell light trucks. It is more like a chess piece with strategic meaning. At some point in the future, it may become a tool for GM to play a balancing act.” An automotive industry observer pointed out.

SAIC's own brand has also become a force that GM cannot ignore. The aforementioned idea of ​​SAIC's desire to purchase the Opel platform is a frontal collision between SAIC and GM. Under this pressure, GM has begun to consider how to maintain a "safe distance" with SAIC.

One example that can be corroborated is that although GM has established a pan-Asian R&D center in China, it shares the platform with the other six R&D centers globally. However, on September 24, GM set up a wholly-owned R&D center in Shanghai, the General Motors China Academy of Sciences. GM China stated that the main research areas of the institute will focus on technology development in four major areas, including advanced drive systems, advanced manufacturing processes, major urban auto traffic safety technologies, and consumer-oriented forward-looking automotive R&D. In addition, research on battery element technology and lightweight materials will also be included in the plan. This may be seen as a sign that GM is maintaining a “safe distance” with SAIC in terms of R&D.

With the addition of FAW, GM may have more room for balancing and restricting the joint venture relationship in China. In this regard, perhaps Gan Wenwei needs to take time to learn from VW China President and CEO Fan Andy.

GM and Volkswagen have exactly the same two partners, SAIC and FAW. Van Anders is a master of "balanced wood" between two partners in the south and north. For example, the replacement of the Shanghai Volkswagen Passat, the MAGOTAN, appeared in the production workshop of FAW-Volkswagen, which is a game where the public is not satisfied with SAIC's tough and directing game.

However, Gan Wenwei needs to pay attention to the fact that the general public is not just an example.

Wen Daen, president of Volkswagen Global, said that in the next two years, Volkswagen will invest 4 billion euros in China to put into production new models and increase production capacity. This has increased the possibility that Volkswagen will regain the throne of the top seller in the Chinese market from General Motors. And Gan Wenwei also cannot ignore this threat.

Far-range worry is inevitable, and the near worry still exists. After dramatic changes such as bids and stalemate, Magna and Russian Sberbank remained the final buyers of Opel. The final equity composition of the new Opel is Magna 27.5%, Sberbank 27.5%, General Motors 35%, Opel employees 10%. The result was not unexpected, but the process was enough to frighten GM's China operations.

At present, the new Regal, Cruze and other models promoted by Shanghai General Motors are all manufactured on the Opel platform. In fact, because the GM-original vehicle platform originally used in the Chinese market has lost its advantages, the European vehicle platform represented by Opel has become a new “engine” for GM to achieve growth in the Chinese market. It is hard to imagine how catastrophic the Chinese business would be if GM lost its dominance over Opel.

"We will share Opel's technology with Magna in Europe, the United States, South Korea and China, so the sale of Opel will not affect GM's business in China." In Gan Wenwei's view, the concern surrounding Opel is only a false alarm. But before the entire transaction is completed, accidents can occur at any time.



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