China’s Growth Signals OnStar Upturn

DETROIT – China’s infrastructure is expanding so rapidly, OnStar is forced to update its map data monthly, three times more often than the telematics provider does in the U.S., where its subscriber base is 15 times larger.

For this reason, and because China’s growing driver population is new to motoring, General Motors-owned OnStar is carving out a solid niche for itself in the world’s most promising consumer market, says Diane Jurgens, who becomes Shanghai OnStar’s president, effective Jan. 1.

“What customers really are attracted to is turn-by-turn navigation,” says Jurgens, currently vice president and chief information officer-GM International Operations.

Conventional portable and factory-installed navigation systems function in China, but motorists there seem to crave the personal interaction afforded by OnStar operators, she tells journalists here during an informal briefing.

“The roads are changing all the time,” Jurgens says, noting “very few people have been driving more than five years.”

OnStar also has become a status symbol of sorts, with subscribers activating the service just to show their friends. “We get a lot of people who will push the button and say hello,” Jurgens says.

One subscriber had OnStar read a scripted marriage proposal to his girlfriend. She accepted “with tears in her eyes,” Jurgen says, adding she contemplated using the call in a marketing campaign.

Don’t expect to see U.S.-style OnStar ads that feature compelling real-life rescues. Despite the swift pace of technological advancement in China, superstition remains strong for a large portion of the population.

Exposure to real-life misfortune, even if the outcome is positive, is regarded with fear in the belief that it brings bad luck, says Jurgens, who has lived and worked in China for the past six years.

Similarly, this belief draws crowds to accident scenes so passersby can touch the wreckage and transfer their bad luck to twisted metal. “You have to be careful,” she says.

After two years on the market, OnStar has about 400,000 users in China. Exclusive to vehicles produced by GM and its domestic partners, a limited-time subscription comes standard with every unit sold.

OnStar has some 6 million users globally. It does not disclose renewal rates, through Jurgens says China’s dynamic growth in China has prompted repeated shifts in market strategy.

“Every time we set a target, we continue to amaze ourselves,” she says.

China is the world’s largest market for new light-vehicle sales, accounting for 16.6 million units in 2010 and 14.0 million through November, according to WardsAutodata.

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