Decision time for GM in China: Stay, scale back or go
Subscribe to enjoy similar stories. General Motors, long a dominant player in China, was hoping to reinvigorate its faltering business in the world’s largest car market with an influx of new models over the past two years. Among them was the electric Cadillac Lyriq, a flashy luxury car that executives hoped would appeal to Chinese consumers who were increasingly gravitating to plug-in cars.
“We think that’s going to be a really, really strong vehicle for us in China and, I think, a good test of things to come," GM Chief Financial Officer Paul Jacobson said in 2022. Two years later, the Lyriq is barely a blip on GM’s sales charts in China, and the automaker’s market share in the country has shriveled. After years of consistent profits in China, GM swung to a loss in the first half of this year.
On Tuesday, GM executives are expected to again field questions during the company’s investor conference on their plans for China—this time under more pressing circumstances. The market-share losses have prompted calls for GM to scale down its business there or even retreat from China altogether. Most every foreign automaker—from Volkswagen and Toyota Motor to Tesla—faces slowing or shrinking business in China, where consumers are flocking to Chinese cars that were once viewed as inferior to the larger global brands.
Traditional automakers haven’t kept pace with the country’s rapid move to electric and plug-in hybrid vehicles. Chinese brands also have leapt ahead in tech features and often are priced well below their foreign rivals. GM Chief Executive Mary Barra has said the company will stick it out there.
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