DETROIT: General Motors Co has spent five years re-writing its playbook for making money in Latin America and the interior of China. Now, it's show time for the first results of a project code-named GEM, for Global Emerging Market.
This time around, GM says, through disciplined cost-control it has finally found a way to make affordable vehicles in bulk for emerging markets, loaded with the technology that consumers want and still make a profit. What GM is counting on them not to notice is that the number of options is limited, to reduce complexity in purchasing and manufacturing, or that touches such as fully-carpeted trunks are absent. "We may not be the absolute lowest price point in China," GM president Mark Reuss told Reuters at the automaker's downtown Detroit headquarters."But we're going to be right in that segment where this is a pretty good-sized car... a huge value for what you pay for it.
Sometimes, that meant spending more. Houlihan gave the green light to spend extra on machines that could weld on the tops of car doors rather than stamping the door in one piece. The extra investment delivered a door that fit smoothly into the roof of the car for a sleeker look.To offset that cost, Houlihan and his colleagues dug into logistics and the supply chain.
GM has tried to localize costs for these vehicles as much as possible which can help offset currency fluctuations that hit markets like Brazil. That can also mitigate the impact of tariffs. U.S. President Donald Trump has escalated trade tensions with China and has threatened a broad tariff on U.S. autos and parts.GM's new emerging market lineup will face plenty of competition. Chinese automakers are pushing into some of the same countries GM has targeted.