China carmaker may buy into GM's IPO
Logos for GM and SAIC
TEXT OF STORY
STEVE CHIOTAKIS: After going bankrupt and getting bailed out by the U.S. government, GM -- General Motors -- may now sell a stake of its company to China's largest state-owned automaker, SAIC. The company has reportedly expressed an interest in buying GM shares for the company's IPO later this fall. The Chinese owning a portion of an American
icon may rattle some.
But as Marketplace's China bureau chief Rob Schmitz reports, it's a more natural partnership than you might think.
ROB SCHMITZ: GM sells more cars in China than in the U.S., thanks to its 13-year-old joint venture with SAIC. That's why you see more Buicks than Toyotas on Chinese roads. So SAIC wanting to own a share of GM is hardly shocking.
PAUL NEWTON: From an industry perspective, it makes a whole lot of sense.
That's IHS auto industry analyst Paul Newton. He says the two companies are already developing energy-efficient engines together, and GM has moved almost all its advanced technology development to new Chinese R&D labs.
NEWTON: So from the perspective of who owns them, then why a financial institution when you can have someone who has a complete vested interest in your success?
The relationship between GM and China is so cozy that the two are working on a communist propaganda film together. Coming to a theater not-so-near you: "Birth of a Party," a celebration of the 90th anniversary of the Chinese Communist Party. The film's official sponsor? Cadillac.
In Shanghai, I'm Rob Schmitz, for Marketplace.