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Related Topics: Project Yellowstone Plants
© 1998 - 2002
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GM Manufacturing : Shanghai Plant SHANGHAI, China, Dec. 17, 1998 - Shanghai GM, the 21-month-old joint venture between General Motors and China’s leading passenger car producer, produced its first domestic vehicle today as a bright white 1999 Buick Xin Shi Ji rolled off the assembly line at a brand new plant here.
GM Chairman John F. Smith Jr., chairman and chief executive officer of General Motors, and Chen Xiang Lin, president of the Shanghai Automotive Industry Corporation (SAIC), GM’s joint venture partner, were among some 2,000 Chinese and U.S. government officials, employees, suppliers and special guests who watched the first Buick, a enhanced version of the North American-based mid-size Buick Century and Regal make its historic debut.
"Not only did we build this plant in 18 months, we also put into place all of the quality, safety, environmental and manufacturing processes necessary to build an outstanding product," Smith said. "This is a credit to this joint venture and a promising sign of great things to come." Donald E. Hackworth, senior vice president, GM North American Car Group, said, "Our joint venture with SAIC is helping to build the industrial and technological base needed for China to continue its rapid pace of economic growth. Also, this partnership is a critical element in GM’s strategy to participate in the emerging economies of Asia-Pacific."
Besides Hackworth, other GM leadership present were Louis R. Hughes, executive vice president, New Business Strategies; Rudolph A. Schlais, Jr., GM vice president and president, GM Asia-Pacific; Robert E. Coletta, GM vice president and general manager, Buick Motor Division; Frank L. Colvin, GM vice president and group director of Engineering, North American Operations Car Group; Ned S. McClurg, GM vice president and general manager of Engineering Operations, GM Powertrain Group; and Lawrence B. Zahner, GM vice president and president, GM China. The China Buick, available in three models and tailored to the Chinese market with such enhancements as an elevated, more spacious rear seat with rear seat-controlled heating, cooling and sound systems, goes into regular production in April and will be on sale in China in June 1999. Its targeted market includes joint venture businesses, private entrepreneurs and government officials. Models offered are the GL, more upscale GLX and the top-of-the line, fully equipped Chinese-badged Xin Shi Ji (shin-sha-gee), which debuted today. Philip Murtaugh, executive vice president of Shanghai GM (SGM) and general manager of GM’s Shanghai Operations, described the building of the first pre-production car as the "culmination of an intense three-year effort to define, design, develop, tool and validate this vehicle so that we could build it to standards of world-class quality. Our ability to leverage GM’s global resources and global processes made this massive undertaking possible." Besides support from North America, Shanghai GM also used GM resources from Germany and Australia. Selected Chinese employees were sent to the United States, Canada, Germany and Australia for weeks – and, in some cases, months -- of specialized training. In fact, many of the processes at the Shanghai GM plant are based on GM operations at the Oshawa Plant in Oshawa, Ontario, where the Buick Century and Regal are assembled. The new plant, built in a former farmlands area about 20 kilometers from the center of Shanghai, contains five shops: press, body, powertrain, paint and general assembly. It is similar to GM plants recently completed in Poland and Argentina and nearing completion in Thailand. Based on lean manufacturing concepts pioneered at GM’s Eisenach facility in Germany, it represents GM’s commitment to reducing structural costs while increasing quality. Shanghai GM’s employment base is about 95 percent Chinese. Present employment is about 1,700, expected to reach 3,000 at full capacity. The supplier base is a combination of East and West with local suppliers expected at about the 40 percent level in 1999 and moving to 60 percent by the second year of operation. Over five years, the joint venture is projected to generate $1.5 billion in exports of U.S. material to China. "This product is designed and manufactured to compete against – and beat – the import mid-size sedans coming into the Chinese market. Not only will it be competitively priced, but it will bring the heritage of the 95-year-old Buick nameplate," Murtaugh said. Buicks first appeared in China before World War I and, in 1929, Buick opened a sales office in Shanghai. However, while Buicks have been assembled in some countries other than the United States, this is the first Buick ever built in China. "We have transferred state-of-the-art technology to this plant, including third generation robotic technology not even in use yet in North America," Murtaugh noted. In the power train shop, 2.98-liter, V6 engines are being built equipped with catalytic converters. In the paint shop, environmental "firsts" for China range from use of waterborne primer to reduce application exhaust emissions as well as use of techniques to limit heavy metal discharge in waste water. In general assembly, doors are removed to make interior component installation more efficient and cockpits get a complete electrical check before being inserted in the car body. Today’s first Buick is the forerunner of an estimated annual production of 100,000 units at the plant. The initial advertising campaign for the China Buick began this month in its initial target markets: the cities of Beijing and Shanghai and the fast- developing south China coastal area of Guang Dong province. SGM is working closely with GM to ensure that the Buicks will be serviced by technology experts using the latest diagnostic equipment. GM China already has 30 established service centers in China; SGM plans to build on that base. Shanghai GM is a 50/50 $1.52 billion investment between GM and SAIC. Initially agreed to in 1995, it was formally signed in March 1997; groundbreaking at the plant was in June of that year. Earlier this fall, GM opened a new assembly plant in Gliwice, Poland and, a year ago, a new assembly plant in Rosario, Argentina.
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