GM’s China operations normal despite bankruptcy image

General Motors Corp. said Monday that its U.S. bankruptcy filing will have no impact on its thriving China operations, reaffirming what it called its “aggressive growth strategy.”

“Our operations across China will operate normally,” Kevin Wale, president and managing director of the GM China Group, said in a statement.

“Our customers will continue to receive top-notch service and warranty coverage, while our dealers will continue to receive product and aftersales parts as usual. There will be no impact on payments to employees, dealers or suppliers contracted to GM China or to our joint ventures,” Wale said.

The company filed for Chapter 11 bankruptcy protection Monday as part of the U.S. government’s plan to shrink the automaker to a sustainable size. The bankruptcy filing is the fourth-largest in U.S. history and the largest for an industrial company.

But Detroit-based GM’s plans for continued growth in China, where its sales rose 33.8 percent in January-May from a year earlier, remain intact, the company said.

“GM has a specific development plan in China for the next five years that demonstrates our great confidence in the country,” Wale said.

GM executives have sought to reassure customers and business partners of the company’s commitment to China, despite its woes elsewhere.

According to GM’s figures, auto sales grew 18.8 percent in China in the first five months of the year, thanks partly to tax cuts and other incentives aimed at promoting sales of small vehicles, one of GM’s strengths in this market.

China is GM’s second largest national market after the United States, followed by Brazil, the United Kingdom, Canada, Russia and Germany.

The company plans to close seven powertrain and parts stamping plants starting in June 2010, while an additional stamping plant will be idled but remain in a standby capacity. The automaker also plans to cut 21,000 employees, or about 34 percent of its work force.

But in China, GM is still looking to expand.

Executives say the company’s China operations are profitable and able to reinvest in facilities without relying on help from the U.S. or elsewhere.

Wale said earlier that the company aims to double sales in China to about 2 million within the next five years, regardless of whether it ended up in bankruptcy protection.

Success in China, which could soon overtake the U.S. as the world’s second biggest auto market, is crucial for GM’s future. Its minivehicles joint venture, SAIC-GM-Wuling, has seen sales soar thanks to small-car friendly policies.

The automaker also makes Buicks, Chevrolets and Cadillacs with its decade-long joint venture partner, state-owned Shanghai Automotive Industrial Corp.