General Motors will invest 445 million dollars to build a new diesel engine plant and to upgrade an existing assembly plant in Thailand, chief executive Rick Wagoner said Wednesday.
The new plant in the industrial coastal town of Rayong will start production in 2010, with a capacity to produce more than 100,000 engines per year, he said. The facility will also employ about 340 workers.
About 90 percent of the engines will be used in GM's nearby assembly plant, which will be upgraded to produce the new model Chevrolet Colorado small pickup truck, he added.
Wagoner said the investment was part of GM's global strategy, which includes growth in emerging markets like Thailand.
GM has struggled with a weakening US economy, losing the top spot in global sales to Japanese rival Toyota in the first quarter, while posting a 15.5-billion-dollar net loss in the second quarter.
But Wagoner refused to concede that GM might fall second to Toyota in annual sales this year.
“This year is not over yet,” he told reporters in Rayong. “We don't worry about coming back to be No 1, but we want to be driven by outstanding cars and trucks, the latest technology and participating in the world market overall.”
Thailand is the world's leading producer of one-tonne pickups. The kingdom has positioned itself as a key regional production base for foreign automakers, which make vehicles here for export around the region.
GM has a relatively small market share in countries like Thailand, where Japanese automakers dominate, but its overall Asian sales have been posting strong growth — while domestic sales in the United States are plunging.
The company's Asia-Pacific president Nick Reilly said that sales in China were expected to rise to 1.2 million this year, up from 1.0 million last year.
GM is also set to open a new Indian assembly plant outside Mumbai next month, he said.
But the steady loss of its US market share — its July auto sales plunged 26.7 percent from one year ago — has forced the company to take drastic measures.
It has shed tens of thousands of jobs, cut costs and switched some production into fuel-efficient cars.
GM has also switched to crossovers, which are SUVs built on car platforms, as more Americans are buying them to seek some respite from gas guzzlers amid high fuel prices.
The automaker is considering the sale of some of the many brands it owns too.
Wagoner told reporters that the company planned to keep the Saab brand, with sales focused mainly on the European market.
GM bought a majority stake in Saab in 1990, then bought the rest in 2000. Saab accounts for less than one percent of GM's sales, and had been thought a candidate for sale as GM thins out its brands.
