To aid in recovering its sales numbers in the world's largest car market, US automaker General Motors has now called on the Chinese government to postpone the rollout of its new emission standards. GM explained that delaying the already scheduled rollout would at least alleviate the effects of the ongoing viral epidemic on its business and allow it to regain its footing.
GM China President Matt Tsien mentioned in a statement that an extension of the already set deadline for at least a few months would give the company a chance to sell more of its older model vehicles. The executive explained that an extension would give its dealerships time to clear their inventories of older models. The extension would also allow its factories to upgrade current models to meet the new standards.
The rollout of China's State IV B Standards, which is scheduled to come into effect on July 1, would effectively make it illegal for GM to sell its older models. Models that do not meet the new standards but are sold before the rollout would still be acceptable.
During a conference call conducted late last week, Tsien mentioned that he expects the country's car market to suffer during the first half of the year before rebounding in the second half. To aid in the recovery, Tsien stated that the government will have to work with manufacturers to alleviate their losses.
Despite the negative effects of the ongoing viral epidemic, which has caused delays in the company's projects, GM remains confident in the long-term growth of its business in China. Tsien told shareholders and analysts that GM is still expecting solid development in its business throughout the entire year and possibly even an increase in market share compared to 2019.
GM's sales in China last year was relatively disappointing as it had dropped by 15 percent to only 3.09 million vehicles when compared to the previous year. The drop was mostly due to the country's overall economic slump and a lukewarm response from customers to its three-cylinder vehicle models.
China is still the United States' largest automaker's largest market in terms of total sales. The company had repeatedly stated that success in China is vital to its global strategy. Over the past couple of years, the company has been pulling out its business in regions such as Europe and Australia to focus its resources in more profitable markets such as China and South America.
The company is also currently reshuffling its business to shift more of its resources towards its electrification. GM announced last week that it is preparing to invest more than $20 billion over the next five years to accelerate its development of autonomous driving technologies and fully-electric powertrains.
