China’s automotive market is growing, fast. At least, so reckons GM President Dan Ammann, who announced at a conference recently that General Motors will be attempting to “richen the mix” of offerings in China in order to bolster profitability.
What exactly does that look like? In essence, General Motors will be pushing to sell more higher-profit SUVs and crossovers in the Chinese market, as well as attempting to grow the Cadillac brand there. The Wall Street Journal reports that the first new vehicle in Cadillac’s $12 billion, five-year plan will be a new crossover, with the coming CT6 sedan also planned for a Chinese launch. While China continues to represent an opportunity for GM, arguably more important, it presents an opportunity for Cadillac, which doesn’t have to contend with decades of brand degredation and poor marketing in GM’s “second growth hub.”
But with market maturation comes uncertainty, and that’s where GM’s “enrichening” strategy becomes truly important. GM is forecasting 6 to 8 percent of industry growth in 2015, but since the Chinese market especially hasn’t yet plateued into a safe equilibrium, the US automaker has to brace and prepare for possible unforeseen turbulence.
Comments
“Get it? “Richen the mix?” It’s an air-fuel ratio pun. It also means more upscale, higher-margin GM products are heading to the Chinese market”
Points out and explains own pun, should’ve known better in the first place.
Actually, those words were borrowed from Mr. Ammann.
GM wants to make a big impact in the Chinese market . Cadillac is building a stretched version of the CTS there and the ‘ol SRX is selling at a decent clip . But the Chinese economy is slowing and GM needs to keep an eye on how much money is spent there by building assembly plants . I still believe Cadillac needs to focus here at home first and then grow overseas .