Shanghai GM Breaks Ground for 300,000-Capacity Wuhan Plant

Shanghai General Motors breaks ground today for a new, 300,000-vehicle-capacity plant in Wuhan in Hubei province in central China.

It will be a completely self-contained production complex with press, body assembly, paint and support facilities.

GM’s Chinese-brand Baojun 630 sedan is built in Liuzhou, Wuhan, by its SAIC-GM-Wuling mini commercial-vehicle joint venture.

The newest Wuhan plant will complement expansion projects under way at two other GM Shanghai locations. Together, the three projects will increase annual production capacity by some 840,000 units.

General Motors Chairman and CEO Dan Akerson said in January the auto maker planned to raise capacity by 760,000 units to support sales penetrations planned for Western and Northern China.

The three expansion projects, all of which will be completed in 2014, will give GM Shanghai annual capacity of more than 1.5 million vehicles.

Existing plants currently are running flat-out and well above their rated capacity of nearly 1 million vehicles to keep pace with increasing sales. In 2011 Shanghai GM sold slightly more than 1.2 million vehicles, an 18.5% increase compared with prior-year.

The event in Wuhan marks GM’s second new-plant groundbreaking within the past 12 months.

The Shanghai GM Norsom Motors division broke ground in September 2011 for a new, 300,000- vehicle-capacity facility in Shenyang in Northern China. That factory also will begin production in 2014.

Additionally, annual capacity at the Shanghai GM Dong Yue plant in Yantai, Shandong, is being expanded by 240,000 units.

Shanghai GM has invested RMB7 billion ($1.01 billion) in the new Wuhan plant built on a 0.9 sq.-mile (2.3 sq.-km) site in the Jiangxia industrial district.

“As we celebrate the 15th anniversary of the establishment of Shanghai GM this month, building a new manufacturing base in Wuhan represents our renewed commitment to contribute to the development of Central and Western China,” says Kevin Wale, president and managing director-GM China Group.

“Shanghai GM Wuhan will allow us to better reach out to our customers in this part of the country, where we expect to see the majority of growth in vehicle demand in the coming years.”