Only if it's Green.

A GM goal: 10% of Asian market by 2010
ASSOCIATED PRESS

November 17, 2006

Supachai Panitchpakdi, left, secretary general of the United Nations Conference on Trade and Development (UNCTAD), speaks at the Asia Pacific Economic Cooperation (APEC)'s CEO summit in Hanoi today. Listening to him at right is Nick Reilly, vice president of General Motors Group. (APICHART WEERAWONG/Associated Press)

General Motors Corp., its market share shrinking at home, is turning to Asia to boost its profits, and aims to capture 10% of the region's market by 2010, the U.S. automaker's regional chief said 10%.

Top target markets are China and India, where rapid economic growth is fueling demand for cars, said Nick Reilly, president of GM Asia Pacific.

GM aims to sell 1.3 million vehicles in Asia this year to grab a 6.5% market share, two-thirds of which is expected to come from China, he said. Last year, GM's sales hit just over 1 million units in Asia for the first time, giving it a market share of 5.7%.

The company also plans to strengthen its presence in South Korea and Southeast Asia, especially Malaysia and Indonesia, Reilly told the Associated Press in an interview on the sidelines of a regional business forum here.

''We hope to increase our market share from 6.5% to nearer 10% over the next five years,'' said Reilly, who was appointed as GM vice president and put in charge of the Asia-Pacific market in July.

''We think that in 10 years' time, China market may well be the largest in the world, overtaking the U.S. ... so to win in Asia-Pacific, you really have to win in China,'' he said.

General Motors, beset by sluggish domestic sales and crippling legacy costs, needs China -- the world's third-largest auto market behind Japan and the United States -- to provide growth it won't find in the United States and other Western markets as it tries to engineer a comeback.

GM has poured money into China with plans to spend $3 billion in 2004-2007. Last year, GM surpassed German rival Volkswagen AG to become the No. 1 foreign automaker in China, which has become General Motor's biggest national market after the United States.

Reilly said GM, which has six joint-venture plants in China, would expand its product offering for the Chevrolet brand and grow its dealerships in China.

In India, where GM is still a minor player, he expects sales there to grow rapidly once its new plant becomes operational in 2008, raising annual production to 240,000 cars from 65,000 currently. There are no plans for a joint-venture in India as the company is confident its range of mini and small cars could help push sales, he said.

''We are now going into the mini-segment. These vehicles are absolutely right for the Indian market...at least for now, in this next phase of expansion in India which will take us to 240,000 cars by the end of 2008, we are doing 100-percent owned,'' he said.

In South Korea, he said GM is confident of growing its market share to ''the mid-teens'' from 11% currently. The company is also exploring ways to boost sales in Southeast Asia, especially in Malaysia which is the region's biggest passenger car market and Indonesia, he said.

''I think it's important it's seen not just as a China play. We want to make our growth evenly spread throughout the region because there are great opportunities,'' he added.

Reilly said the Asia-Pacific region currently contributes about a fifth of GM's global sales and is the ''biggest growth area for GM around the world.'' A strong presence in the region will help GM fend off competition from Japanese rival Toyota, which is racing to overtake GM as the world's largest automaker, he said.

GM now has production facilities in China, India, South Korea, India, Thailand and Australia.

''In Asia-Pacific, Toyota is well ahead of us because of its strength in Japan... but we have more than double our market share in the last 3 years, so we are certainly headed in the right direction. We've got good plans to keep it that way,'' he said.

''Globally, certainly our position in Asia Pacific will help us to compete with Toyota.''

Reilly said GM would seek to compete in price-sensitive segments in emerging markets where Toyota is very competitive.

''People are getting off bikes and scooters for the first time into a vehicle. We have not been very competitive in these emerging market segments. That has not been GM's traditional area but that will change....we will have entries in those price-sensitive segments,'' he said but did not give details.

He said Asia-Pacific is also emerging as an important production base for GM. Although GM now export cars mostly from its factories in Thailand and Korea, he said China and India are expected to emerge as new bases in the long run.

Copyright © 2006 Detroit Free Press Inc.