US for Sale: Obama Cedes Chunk of GM to China

Posted on December 5, 2009


It has not been long since President Obama returned from his trip to Asia in general, China in particular. We now discover that a large part of GM’s share in a partnership entered into with China’s SAIC auto company has been sold to SAIC. The Financial Times reported today that:

General Motors is to cede majority control of its thriving Chinese passenger car venture to its state-owned Chinese partner, SAIC, as part of a deal that will also take the Shanghai-Detroit partnership into a new $650m joint venture selling low-cost vehicles in India.

Was the shadow CEO of GM busy in China giving away US assets in repayment for China’s loans to the faltering US economic economy?

FT went on to describe China’s aggressive moves into the auto industry that have all but eclipsed US manufacturers. Their aggrandizement includes:

[… moves by ] another large state-owned Chinese carmaker, Beijing Automotive Industry Corp, [… is] keen to buy GM’s Saab unit[.] Bank of China said it had arranged a Rmb20bn ($2.9bn) line of credit for BAIC, enough to finance a potential bid.

The article goes on to quote an automobile industry analyst  who found it incredulous that anyone would move from a 50-50 partnership to the status of a junior partner.

It also appears that the SAIC-GM venture in India has GM donating a manufacturing facility and the future for other concessions looks bright to further “build trust.”

But in the US, the Chinese are not out to land the big business deals that make headlines and then cause withdrawal under pressure. Chinese entrepreneurs are buying up land and operating smaller firms across the country. These businesses are springing up at an alarming rate. [Scam.com]

Snopes.com has put to rest the rumor that Obama gave China eminent domain over land and factories in this country if we default on their loans to us.

But fiction can inspire action in the real world. Obama’s apologies to other countries for his perceived notion that the US has been either rude or out of line entirely is a fiction. But stranger things have  happened – such as our Chief Executive bowing to leaders world-wide.  Now that IS the kind of rude and bad behavior that gives our country’s hard earned prestige away.

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