Hi Carranza2, I do not suppose CB can be convinced to switch her Range Rover for a GM SUV:0)
GM to Use Engines From China In SUVs Built at Canada Plant
online.wsj.com
By GREGORY L. WHITE
Staff Reporter of THE WALL STREET JOURNAL
DETROIT -- General Motors Corp. plans to import engines from a joint venture in China to install in a Chevrolet sport-utility vehicle to be built in Canada starting in 2004, the first imports of Chinese engines for GM's U.S. vehicles, Buzz Hargrove, president of the Canadian Auto Workers said Monday.
GM spokeswoman Debbie Frakes declined to comment on the auto maker's plans. She said GM doesn't currently import engines from China to the U.S., although it does import V-6 engines for some North American vehicles from the United Kingdom and brings in transmissions from plants in France and Hungary.
Mr. Hargrove said the engine plans came up in contract talks with the No. 1 auto maker last month. He added GM officials said the engines would come from a plant in Shanghai that already makes the engines for the Chinese market but is running well below capacity. "It was hard for us to argue they should duplicate the investment here," he said.
The V-6 engines will go in the Chevy Equinox small SUV, which hits the market in early 2004 and will be made at a plant in Ontario that is a joint venture between GM and its Japanese affiliate Suzuki Motor Co. The China plant is a joint venture with Shanghai Automotive Industry Corp.
Eric Fedawa, a consultant at CSM Worldwide, said GM's Shanghai plant, built in the mid-1990s at a cost of $1.5 billion, has annual capacity of about 150,000 V-6 engines, but is making only about a third of that number for Buick sedans and minivans GM sells in China. The two GM plants that make the same engine in North America are running at or above capacity, he noted, leaving little room for expansion
Mr. Fedawa said he doesn't expect GM to make a major shift of engine production to China, even though labor costs there are lower than in North America. "China's a long way away, especially if you're shipping something as big as an engine," he said. This case "is more of a capacity issue."
GM and other U.S. auto makers are moving heavily to increase sourcing of other parts from China, where costs are dramatically lower, however.
Write to Gregory L. White at greg.white@wsj.com
Updated October 29, 2002 |
