GM won't export out of China or dump $3.2 billions in product R&D until they are allowed a 100% ownership. In the meanwhile, foreigners will pass on China to go where the government does allow 100% foreign ownership and a massive pool of local engineering talent is available, namely India.GM's Korean outfit to get $3.2 billion investment
Posted Apr 23rd 2007 3:33PM by Frank Filipponio
Filed under: Plants/Manufacturing, GM, Earnings/Financials
We knew that the new GM global small car platform was important to the embattled carmaker, but now we know just how valuable GM thinks it is. The new Gamma is apparently worth quite a bit to the future of GM -- $3.2 billion to be exact. That's how much GM has pledged to invest in GM Daewoo Auto & Technology Co. over the next two years. The money will primarily go towards "product and powertrain," according to GM CFO Fritz Henderson. He made the announcement at a press conference last week in Seoul. Not only does it show the importance of the Gamma platform, but it also shows the increased importance of GM's Korean development operations.
Besides the Gamma, GM Daewoo will also take on new R&D responsibilities, with a new center planned for the next two to three years. Diesel engines and a new six-speed transmission are also coming from this Korean facility. The Gamma cars, themselves, should start production in late 2009, with a range of gas and diesel engines displacing 1.2 to 1.8 liters. The vast majority of these products should be sold outside of Korea.