firstland.jpgIn stark contrast with GM's problems back home, Shanghai GM, its Chinese joint venture, took the accolade as the leading automotive manufacturer in China in May with sales of 36,400 units.

SGM is a 50:50 JV between the world's biggest carmaker and Shanghai Automotive Industry Corp.

FAW-VW, Volkswagen's JV with China First Automotive Works sold 28,700, while Shanghai VW, the Germany company's JV with SAIC, ranked third with sales of 27,300 cars. China's own Chery Automobile was fourth in volume sales at 23,200 cars.

SGM has grown to have one of the largest product and brand portfolios among the automotive JVs in China. In 2005, GM overtook VW as China's top foreign car maker.

China is also one of the few bright spots for the US giant. GM has four manufacturing ventures in China and their combined profits more than doubled in the first quarter of 2006 to a record $70m.

GM's North American automotive business, meanwhile, is losing money and market share. It is embroiled in an accounting scandal and, if that wasn't enough, it will soon face competition on its home turf from Chery, which plans to sell 250,000 US-made cars in the US in 2007.

If you hadn't noticed, Chery sounds suspiciously similar to GM's Chevy brand — GM's lawyers are already on the case.

Meanwhile, China's automobile market — the world's third largest — continues to power ahead. In the first fourth months of 2006, sales of passenger vehicles in China soared by almost 50% over the same period a year earlier.

These days, the enthusiasm of China's growing middle class for cars and other trappings of western consumer society is largely taken for granted.

Nevertheless, it is still strange to see the People's Daily, the official organ of the Chinese Communist Party, breathlessly extolling the virtues of SGM's high-end MPV, the Buick GL8 Firstland (pictured above), complete with “luxurious and comfortable” features such as Harman Kardon sound system, GPS and “leg pillows on the back seats”.

How much? For you, comrade, prices start at a cool 288,000 yuan, or $36,000. China's urban workers earn an average of $200 a month.