Sales boom in China helps GM's rebirth: Experts
- Source: People's Daily Online
- [16:27 November 19 2010]
- Comments
The General Motors has made a triumphant return to Wall Street on Thursday, about 17 months after Obama administration rescued the automaker. While it is celebrating the dramatic rebirth, a sales boom in China has obviously boosted the company, experts said.
US President Barack Obama said the return of GM to the US stock market and the Federal government is expected to recoup the $50 billion taxpayers' bail-out money, showed some of the "tough decisions that we made" during the financial crisis were beginning to pay off.
"American taxpayers are now positioned to recover more than my administration invested in GM, and that's a good thing, "Obama said on Thursday at the White House.
The GM stock rose sharply at first, rising to nearly $36 per share from $33 selling price for the IPO before pulling back and closing at $34.19.
Experts said that booming auto sales in Chinese market has contributed to GM's success. Global automakers including GM are increasing looking to China to drive revenues and offset weak sales elsewhere. Inspired by the growing affluence in China and Beijing's stimulus policy to offer tax reductions and subsides, China's customers have bought cars like potatoes in the past two years.
GM said recently it is set to sell more than 2.2 million vehicles in China market this year after posting record sales for October.
GM and its ventures in China sold 199,641 vehicles last month, up 20 percent from the year before. That took its sales for the first 10 months of the year to 1,976,913 vehicles — a gain of 36 percent, it said in a statement Thursday.
The US center for automotive Research estimated that Federal rescuing GM and Chrysler saved more than 1.1 million jobs in 2009 and 314,000 jobs this year.
"With it's first day of trading, the once near-death automaker "took another big step toward becoming a success story," Obama said. He emphasized that the revitalized GM proved that "doubters and nay-sayers" were wrong.
"We are finally beginning to see some of these tough decisions that we made in the midst of the crisis pay off," Obama said.
