SAIC-GM-Wuling Automotive Co., a joint venture between GM, SAIC and the Liuzhou city government, are discussing ways to increase production capacity to at least 1.5 million vehicles by 2013, up from its current target of 1.3 million vehicles, the person said.
The automaker may build new plants in Liuzhou in southern Guangxi province and in Qingdao in eastern China, to meet market demand, the person said.
One of the options being considered is to build a new factory, the person said. A new plant with production capacity of 300,000 units may cost the venture up to 1.5 billion yuan ($227 million), the person estimated.
SAIC-GM-Wuling produces the best-selling Wuling Sunshine minivan and is currently expanding its production in Liuzhou, GM said in December.
The automaker is building a new production complex with an annual capacity of 400,000 units to support output of its new brand of Baojun passenger cars, GM said in December. The manufacturing complex is set to be completed by the end of 2012.
SAIC-GM-Wuling will raise the capacity of its Liuzhou site to 800,000 units by the end of 2012, the venture said last June. The automaker sold 754,961 Wuling Sunshine minivans, which cost as little as 30,000 yuan, in China last year, according to industry consultant JD Power and Associates.
In other news, Shanghai Automotive Industry Corp., the parent of SAIC Motor, may list all of its operating assets and is studying several options to do so, said two people familiar with the company's plans.
SAIC Motor Corp. and Huayu Automotive Systems Co., the two listed units of Shanghai Automotive, suspended trading of their shares pending an announcement about a "major matter" involving their parent, according to separate filings to the stock exchange.
Shanghai Automotive sold automotive assets to SAIC in 2006 and car-parts operations to Huayu in 2008 as part of a wider transfer of businesses from China's state-controlled companies to listed units. The Shanghai government-owned automaker is seeking to expand as vehicle sales jumped 32 percent in the nation last year.
Zhu Xiangjun, a Shanghai-based spokeswoman at SAIC, didn't return telephone calls seeking comment. Johan Willems, GM's Shanghai-based spokesman, declined to comment.
Source: Auto News China
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