Cadillac sales were up on strong results for the SRX crossover, which is GM’s key representative in the premium-SUV niche that has been one of China’s hottest automotive segments in recent months. Cadillac’s overall China volumes are still tiny, especially in comparison with those of GM arch-rival Volkswagen‘s white-hot Audi brand. Increasingly, there are hints that GM has an ambitious long-range plan for Cadillac in China (and elsewhere), but such a plan is expected to take several years to implement.
Meanwhile, while VW hadn’t posted its February sales results as of press time, it’s likely that GM continues to hold a small lead over VW for the overall sales lead in China – even as it struggles to catch up with VW’s huge lead in profitability.
The upshot: Steady sailing in China for now
Here’s the takeaway: GM’s China operation continues to show steady gains. While there’s room for significant improvement – most notably in profit margins, where VW’s lead is huge thanks to design and production efficiencies and a much more favorable product mix – GM’s Chinese joint ventures continue to be well-run and to generate solid quarterly returns.
That means, for better or worse, that major changes to GM’s business in China aren’t likely anytime soon. With so much of GM’s senior executives’ attention focused on more pressing challenges, like revamping GM’s European operation and overhauling its U.S. product line, GM’s China story is likely to be one of small but steady gains for a while.
The article GM Surges Ahead of Toyota in China originally appeared on Fool.com and is written by John Rosevear.
Fool contributor John Rosevear owns shares of General Motors and Ford. Follow him on Twitter at @jrosevear. The Motley Fool owns shares of Ford. Motley Fool newsletter services recommend Ford and General Motors.
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