According to Reuters, people familiar with the matter said that GM will close a factory in Shenyang, a northeastern city of China, as part of the company’s strategy for restructuring in the Chinese market. Sources inside the company revealed that the factory mainly produces Buick GL8 small van and Chevrolet Tracker SUV, which are exclusively for the Chinese market.
General Motors cooperates with SAIC to produce brands such as Buick, Chevrolet and Cadillac in China. The closure of the Shenyang factory is part of the cooperation adjustment between the two parties, aiming to optimize resource allocation and enhance market competitiveness. The factory closure highlights the intensified competition and changes in consumer preferences faced by GM in the Chinese market. The move underscores GM’s commitment to strengthening its high-end product line to gain a larger share of China’s lucrative luxury car market.
General Motors CEO Mary Barra said at a car conference in New York last week that GM will focus on Cadillac, Buick and high-end import businesses in the future of China, the world’s largest auto market. Meanwhile, she noted that these high-end models are in strong demand among Chinese consumers. Mary Barra said she is confident that GM is leveraging its high-end segment to achieve sustainable growth.
Chinese local automakers dominate the domestic market in China, and GM’s restructuring plan in the Chinese market is designed to meet the challenges of competing with Chinese automakers. In the fourth quarter of 2024, General Motors reported $4 billion in restructuring expenses in China, including the closure of factories. Nevertheless, the company still realized its main equity gain in China in the fourth quarter of 2024 before deducting the restructuring expenses. GM officials said the company is expected to make profits in China in 2025, although sales are still well below the 2017 peak of 4.04 million units.
In 2024, GM’s sales in China fell 14% year-on-year to just over 1.8 million units, continuing a steady decline since 2018. GM reported that while sales of gasoline cars and light trucks fell, delivery of electric vehicles, including electric cars and plug-in hybrids, surged 50% year-on-year, accounting for nearly half of its total car sales in 2024.