General Motors reports its sales in China skidded 15% to 3.09 million cars and trucks. The company expects further erosion in 2020.
China has become GM’s largest national market for its Buick and Cadillac brands, with 2019 sales of 850,000 units (down 17%) and 213,700 units (up 4%), respectively.
Outpacing the Market, in a Bad Way
But GM’s combined sales in China have been falling for two years. More importantly, they’ve outpaced the market’s overall shrinkage, which is being driven by an economic cool-down and the effects of the U.S.-China trade war.
The company makes cars in China through three joint ventures. Its sales in the country peaked at 4.04 million vehicles in 2017 but fell 10% to 3.65 million in 2018.
Last year’s 15% decline came even though the company rolled out 20 new or refreshed models. Those updates weren’t enough to stop double-digit negative growth GM’s Chevrolet unit (-20% to 418,000 units) and entry-level Baojun brand (-28% to 608,300 vehicles).
GM vows to continue its cavalcade of new models, including several with electrified powertrains. For 2020, the company’s new-car focus will be on luxury models and midsize and large SUV/crossover vehicles. Those are the two segments where demand is strongest.
At the same time, GM plans unspecified efforts to cut costs and boost operating efficiency as it braces for “ongoing headwinds” in China. That sounds like GM is bracing for a slump that will continue for some time.
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