The billions of taxpayer dollars General Motors is begging from Congress right now could end up creating jobs in China, and not the United States.
The car giant is in talks to increase its stake in a Chinese joint venture that makes small, cheap cars and vans, reports The Wall Street Journal
GM wants to up its stake in SAIC GM Wuling Automobile Co. in Guangxi province in southwestern China, the paper reported, citing unnamed sources. The car company is 51 percent privately controlled by Shanghai Automotive; GM now owns 34 percent and would presumably buy more from the state-run minority partner.
GM declined to elaborate on the report.
This news comes as GM CEO Rick Wagoner joins his counterparts from Detroit in a bid to get $50 billion in taxpayer-backed loans, ostensibly to retool factories in the United States to make fuel-efficient cars of the future.
Wagoner went so far as to warn on financial talk shows this week that letting GM fail would do huge damage to the U.S. economy. Not even bankruptcy solves its problems, says GM executives.
GM sales in the United States fell 21 percent last quarter and 45 percent in October alone. GM on Nov. 7 warned it would run short on operating cash by year-end. It needs $11 billion a month just to stay afloat, reports Bloomberg.
The company “would be devastated” by a bankruptcy filing, Wagoner told Bloomberg Television.
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