Restructuring in China costs General Motors billions

More than 5 billion US dollars (4.43 billion Swiss francs) in costs and value adjustments will be incurred, as the car giant announced in a letter to the US Securities and Exchange Commission (SEC). According to the letter, General Motors will write down the value of its joint ventures in the People's Republic by up to 2.9 billion dollars. The company estimates a further 2.7 billion dollars as costs for the closure of factories and the restructuring of activities in the country.

General Motors - like other foreign manufacturers - had recently lost increasing market share in China. China's domestic car industry, on the other hand, is on the rise. The major manufacturers from the USA, Europe, Japan and Korea have responded in recent years by closing plants and withdrawing from joint ventures.

The pressure on General Motors and its Chinese joint venture partner SAIC Motor has also increased recently. In the first nine months of the current year, the Detroit-based company posted a loss of 347 million US dollars (around 307 million Swiss francs) in China.