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Additional info for American Wheels Chinese Roads
Not a chance. Even though Ford’s media leak did not match the reality on the ground, the GM leadership in Detroit was stunned. ” GM felt that it needed to act quickly and decisively. GM had come to understand that what mattered most to officials at SAIC was learning how to make cars on their own. Leading China’s drive to build a car to call its own was, in fact, SAIC’s original mission. The China strategy was as simple as it was straightforward: Step 1. Form joint ventures with leading global carmakers.
China offered the perfect opportunity. Smith’s drive for change was urgent. GM’s North American operations were a black hole: an albatross of legacy costs; an intransigent union; intense competition from the Japanese; a tumbling market share; and wounded brand reputations across several divisions, including Oldsmobile, Pontiac, Cadillac, and Buick. GM’s international operations, on the other hand, offered some rays of hope. In Europe, South America, and Asia, GM enjoyed healthy growth and profits.
There were four primary contributing factors: First off, the market structure was nothing like it was in the United States. indd 20 5/13/11 11:25:22 AM g e t t i n g a f oo t h o ld—in q uicksand 21 government officials and state enterprise executives who were spending state funds. These people did not actually drive the cars—they were comfortable sitting in the back seat, being chauffeured around the city. Pickup trucks, in their eyes, were basic work vehicles designed for low-income farmers in the countryside.