General Motors (GM) is a US carmaker that was the world’s biggest, although Toyota is challenging it for the title. It was hard hit by the global financial crisis, needing a government bailout, but emerged from chapter 11 reorganisation in 2009, and held an initial public offering in 2010. It returned to profit in 2011.
GM emphasises US investment after criticism of spending in China
Carmaker responds to attack on US$11b outlay in China by pointing to US$16b spending at home
General Motors, profitable for 13 consecutive quarters, is planning to invest US$16 billion on factories and facilities in the United States from now to 2016, more than it will spend in China, the company said.
"The US$11 billion in capital that will be spent in China by 2016 is coming out of our joint ventures rather than Detroit and is far less than the approximately $16 billion in capital GM will invest in the US over that time," Selim Bingol, GM's vice-president of public policy, said in a letter published in the Wall Street Journal.
GM disclosed the US investment figure after announcing the US$11 billion investment for its joint ventures on the mainland last month in Shanghai. That was a 70 per cent increase from the plan outlined in 2011 to spend US$7 billion through until 2015. GM sold 2.84 million vehicles last year through its joint ventures on the mainland, its biggest market, and wants to boost that to 5 million by 2015.
The Journal last week ran a commentary on its op-ed page titled, "Welcome to General Tso's Motors," saying China "is disproportionately benefiting" from the US governmen-backed bankruptcy reorganization of GM in 2009 . The Journal's editorial page had previously criticised the bailout.
Bingol said in the letter that GM "was in China long before the economic meltdown of 2008-2009, and not one dollar of US taxpayer rescue money was spent on our operations there. Our Chinese joint ventures are self-funding, meaning we require funds spent there to be generated there."
GM is introducing 20 new or refreshed vehicles in the US, part of a plan to increase profits and rebound from last year's 88-year-low in US market share.
GM has said it invested US$8.5 billion in the United States since emerging from bankruptcy, including efforts to prepare for production for more fuel-efficient engines and vehicles.
The company reported on May 2 that first-quarter net income fell 11 per cent year-on-year to US$1.18 billion. Profit in international operations, which include China, slipped to US$495 million from US$521 million.