International Trends

The Asia/Pacific economy is once again growing and will be the source of important automotive growth in coming years. “Asia Pacific is really a growth story in the auto industry,” says Fritz Henderson, president, GM Asia Pacific.

The economy in Asia will grow 5.2 percent this year (excluding Japan) and that will translate into increased new vehicle sales, says Henderson.

“Some of these markets are just on fire,” Henderson says. “We feel confident we will pick up share vs. 2002, 2003.”

But the battle will be won capturing individual markets, he says. And especially those markets with the highest growth potential. According to GM data, China tops the list of the markets with the highest automotive growth from 2002 until 2012. Also on that list are India, Japan, South Korea, Thailand, Indonesia, Malaysia, Taiwan and Australia.

“The job must be done market by market,” Henderson stresses.

The company has developed a long-ranging strategy to help it see substantial growth in the region.

Much of the strategy relies heavily on company’s affiliates and joint ventures. “Multiple and unusual business structures are a way of life (in Asia/Pacific),” Henderson says.

Part of that strategy involves the company leveraging its existing product and powertrain portfolio. Especially important GM-Daewoo, which will play a key technology role in the region along with Holden, which is smaller volume but has a top the line reputation in the area. Also appropriate on a case by case basis, says Henderson, are the GM North America, Europe and Latin America product. GM’s Japanese partners also will help company compete in market segments where it is absent. Suzuki, for example, is very strong in minicars, a large segment in Japan. “This is not an expertise that we at have,” Henderson says.

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DC to sell Smart in U.S.

DaimlerChrysler will sell its Smart car in the U.S. starting in 2006. The four-seat version will be made at the company’s Juiz de Fora plant in Brazil, which also builds the Mercedes A- and C-Class vehicles. DC has sold about 500,000 Smarts since its launch in 1998.

VW to buy stake in Eurocar

Volkswagen AG is reportedly considering taking a stake in Eurocar — its Ukrainian assembler. According to Eurocar, VW may take a minority stake in the company next year. It builds cars for VW’s Skoda division. Eurocar built 3,700 cars in 2002 and hopes to build 8,100 vehicles this year and 15,000 in 2004. It is making $200 million in investments to eventually boost capacity to 45,000 vehicles.

Alfa Romeo heads to Mexico

Fiat SpA says it will sell its Alfa Romeo vehicles in Mexico starting later this year. The company will sell its 147, 156, 166 and GTV models at GM’s Cadillac and Saab dealerships in the country. GM owns 20 percent of Fiat Auto and will also sell Fiat branded vehicles at some of its dealerships.

Nissan transferring Pathfinder
Nissan is shifting Pathfinder SUV production from Japan to its Smryna, Tenn., plant. Production will begin in late 2004. Nissan will invest about $250 million to begin building the vehicle. The addition will increase capacity at the plant to 550,000 vehicles each year.

Fiat says doesn’t intend to use ‘put’

Fiat says it is not planning to use its put option, which would force GM to buy its Fiat Auto division. Instead it will continue to attempt to turnaround the suffering division, the company said in a filing to a government agency.

“Fiat views the exercise for the put only as a secondary possibility,” the company said in the statement. The two companies currently have differing views of the put option — Fiat says it is still valid, GM says it may be no longer be enforceable.