GM '' bullish ' on China, sees market reaching 30 million automobiles by 2020: executive

© Reuters. Tsien, president of GM China, responds in front of a map during an interview with Reuters at the company’s headquarters in Shanghai

By Norihiko Shirouzu BEIJING (Reuters) – General Motors Co (N:-RRB- is “rather bullish” about the recuperating auto market in China and is responding to a shift in development towards practical models in smaller cities, a sector typically ignored by foreign automakers, stated GM China chief Matt Tsien. GM expects the marketplace to grow to around 30 million cars by 2020 from 24.6 million last year, which its local budget-car joint venture offers it an edge over global competitors in development areas beyond major cities, Tsien stated in an interview. “And it is reallying going to grow beyond that,” Tsien said, referring to China’s general automobile market. “There will be a point of saturation, but we are most likely a years away.” China’s automobile market has recuperated from a combined 2015 when sales overall fell monthly from April through August, to register growth of 14.6 percent in the current reporting month of June. However continued sluggishness in gdp (GDP) development includes unpredictability to the marketplace’s near-term outlook. Added to the changing nature of China’s auto market is which Tsien described as the rapid change in development patterns. Sales have stalled in “tier-one” mega-cities such as Beijing and Shanghai however continue unabated in smaller sized cities and rural areas where drivers prefer fundamental, affordable cars – the type of low-margin cars foreign automakers have actually mostly ignored. “Tier-one is near saturation,” said Tsien, 55, who must been running GM’s China operations given that 2014. “But when you go into tier-three and -four cities, we saw double-digit growth for the entire of last year. It’s still growing at double-digits this year and will continue.” Tsien said GM is better-positioned than foreign rivals in such cities because of financial investment in no-frills brands that began in the early 2000s when it created SAIC-GM-Wuling Auto (SGMW) with SAIC Motor Corp Ltd and Guangxi Car Group, formerly Wuling. SGMW’s two low-priced brand names, Wuling and Baojun, cost a rate of roughly 2 million vehicles a year. “There is a great deal of willingness from a consumer viewpoint to invest,” said Tsien. “There is a lot of discretionary earnings. Shops are hectic. Restaurants are busy. Internet shopping is booming. “We continue to be quite bullish about the growth prospects of the Chinese car market. It’s reallying going to continue to grow.”
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