GM has extended for 20 years its contract for SAIC-GM, the 50:50 joint venture it operates with SAIC Motor. Amid sluggish sales in China and intensifying competition in the shift to electric vehicles, GM — which had been closing plants and cutting model lineups — will focus on Buick and Cadillac as its core brands and discontinue Chevrolet’s domestic sales in China.
Instead, GM will export Buick and Cadillac vehicles produced in China to the Middle East, Africa, South America, Mexico, and other regions, with a strategy of expanding SAIC-GM’s role from a domestic-market focus to a global production and export base. Plans were also announced to launch at least 30 electric and hybrid models by 2030.
From the standpoint of the R2R equipment supply chain, this news is meaningful because GM is pursuing a dual strategy: continuing to make use of China’s production cost competitiveness and electrification technology capabilities, while lowering its parts supply chain’s dependence on China. If a finished-vehicle maker adopts this kind of dual-track strategy, similar pressure is likely to be placed on the electrode and assembly equipment supply chain that makes the batteries for those vehicles as well.