General Motors and SAIC planning electric cars for Chinese market

General Motors have just announced their intentions of bringing out an electric car which they are planning in conjuncture with a Chinese automaker. The company made the announcement on Tuesday in which they stated that pressure was being exerted by the Chinese government on foreign car makers in a JV to transfer electric car technology to China.

GM is the main foreign manufacturer of fuel run cars in China.  The country is keen on launching green energy automobiles and would need the expertise from General Motors to help them in this venture. Mr. Stephen J Girsky, Vice Chairman of General Motors said that the Chinese government  felt the need to bring in more fuel efficient and green cars into the country due to increased customers demand.

GM would be entering into a joint venture with Shanghai Automotive Industry Corporation. Such electric vehicles would be assured of some tax benefits by the government.  In fact, the Government of China has already assures subsidies upto $19,300 per electric car. For foreign car makers, the benefits only become available when they transfer technology, and don’t use it on their own cars without first seeking approval. As such, GM would run up a brick wall in trying to import the Volt.