GM To Import Chinese-Made Engines For SUV Assembly In Canada

Autoparts Report, Nov 5, 2002

General Motors is to import a V6 engine from China to install in a planned Chevrolet sport-utility vehicle to be built in Canada, the company's first use of a Chinese-made engine in North America, Bloomberg News reported, citing Canadian Auto Workers (CAW) chief Buzz Hargrove.

Hargrove told Bloomberg that GM would ship the engines from one of its joint ventures in China to Ingersoll, Ontario, where it would build the sport-utility from 2004. Hargrove added that GM, which in September reached a new three-year contract with the CAW, told his union that it does not have the capacity to build the engine in Canada. "We didn't see much that we could do to change the decision. It's an engine they are already building in China," Hargrove told Bloomberg.

GM declined to comment on engine plans for the Equinox. David Cole, executive director of the Ann Arbor, Michigan-based Center for Automotive Research, told Bloomberg News that Chinese consumers aren't yet buying enough vehicles to keep General Motors plants in the country at full capacity. "The trick with an investment is to use it a lot" so the automaker is turning to exports, he said, according to Bloomberg News.

Bloomberg said the GM joint venture with Shanghai Automotive Industry builds engines as well as cars at a $1.5 billion factory. General Motors, which has three other joint ventures in China, has also said it might export engines from Shanghai to other Asian markets, Bloomberg added.

According to Bloomberg, GM has previously said it would build at least 100,000 Equinox models a year at the Ingersoll plant, which is half-owned by its affiliate Suzuki.