General Motors Co., the worlds third-largest auto manufacturer by sales, revealed that its passenger-vehicle joint venture located in China was contacted by the antitrust regulator in the country. This happened while an industry investigation is being carried out against no less than seven foreign car manufacturers that were forced to reduce prices of spare parts, including Honda Motor Co., VWs Audi, Bayerische Motoren Werke AG, Fiat SpAs Chrysler, Daimler AGs Mercedes-Benz and others.
The joint venture between General Motors Co. and its partner SAIC Motor Corp., has “actively responded” to requests from the price supervision and anti-monopoly bureau of the National Development and Reform Commission for two years now, GM said in an e-mailed response to Bloomberg News yesterday. The joint venture has also provided its assistance for the automotive industrys investigation and research, the company added.
General Motors Co. said in an e-mailed statement, which was cited by Bloomberg: “We have continuously strengthened the company’s operations and management. Shanghai GM will continue to provide high-quality products and services in accordance with national regulations and policies, and is committed to strengthening the value for money of its products.”
The major economic planner in China, which is responsible for overseeing prices, has forced auto manufacturers to reduce their prices in the past month, as a part of an investigation started in late 2011. As reported by Bloomberg, General Motors Co. said in its statement that its major models are “priced at a reasonable level, with almost no markups in sales”.
The news has been announced at a time when General Motors Co. has put its international business model under a close examination and is trying to change the way it makes vehicles overseas. One of its top executives – Mr. Stefan Jacoby – said that the company is seeking to cut its losses generated in key emerging markets, including Southeast Asia and India.
Mr. Jacoby, who is a head of the international operations of the U.S.-based car manufacturer, said in an interview, which was cited by the Wall Street Journal: “Right now, we have a too-diverse product program.”
The company is hoping that under Mr. Jacobys lead it is to make a fresh start outside its home market. The company is betting on its Chevrolet brand in overseas markets, where it is to rationaliZe its production processes and models range, as well as to restructure its supply chain.
General Motors Co. was 0.81% up to close at $33.80 per share yesterday, marking a one-year change of -6.16%. According to the information published on CNN Money, the 14 analysts offering 12-month price forecasts for General Motors Co have a median target of $45.50, with a high estimate of $54.00 and a low estimate of $33.00. The median estimate represents a +34.62% increase from the last price of $33.80.
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