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General Motors Is Riding High In China–For Now

On Friday, Ray Bierzynski, head of electric vehicle strategy in China for General Motors, admitted his company had sold extremely few Chevy Volts in the world’s largest car market. He declined to give sales numbers for the much-publicized plug-in hybrid.

Bierzynski didn’t appear overly worried that the 13 dealers in Beijing, Shanghai, and Guangzhou had not been able to move Volts off showroom floors. After all, who could blame the sales force? In China, the car, due to tariffs, retails for about twice its pre-Federal credit U.S. MSRP of $39,145.

Chevrolet, therefore, could sell more Volts in China if it built them there, but GM chief Dan Akerson in April said the company had no plans to do that. Why? Bierzynski suggested his goal was not to put a Volt in every Chinese garage. The car, he explained, is meant to pave the way for the company’s other alternative-energy vehicles. GM is planning to sell the Cadillac ELR electric coupe and is thinking about an all-electric version of the Chevy Sail, a popular offering in China.

The company is serious about alternative-energy vehicles in China. It has to be, for several reasons. Automakers will have to meet ambitious fuel-economy standards by 2020, and gas-powered engines may not be efficient enough to achieve compliance. Moreover, Beijing wants 500,000 electrics and hybrids on the road by 2015 and five million by 2020. That, for most car executives, looks like the beginning of a good market.

To meet future demand, GM is not bringing the latest foreign technology to China. There are real concerns about intellectual property theft, for one thing.

Yet the automotive giant needs to innovate to meet the demands of the Chinese market, so it is developing the next generation of vehicle battery systems there, in Shanghai. Its lab just announced what may be a breakthrough. “Producing the first prototype battery cells is a big step forward for the GM China Advanced Technical Center,” said John Du, director of the company’s China Science Lab. “It is critical for enabling GM to develop smaller, lighter and lower-cost new-generation batteries.”
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