General Motors just extended a joint venture with a Chinese automaker for twenty years. Twenty years. The company that needed a government bailout to survive 2008 now projects confidence two decades into the future. Bold move for a corporation that can't figure out how to make sedans Americans want to buy.
The deal focuses on selling Buicks and Cadillacs in China while exporting Chevrolets built in China to non-U.S. markets. Buick. The brand your grandfather drove to the pharmacy in 1987. Cadillac. The car that screams "I wanted a Mercedes but my credit score said otherwise." These are the weapons GM chose for battling geopolitical tensions.
Geopolitical tensions. That's the phrase we use now instead of "our governments actively distrust each other and periodically threaten trade wars." GM looked at that situation and said yes, this is the perfect time to commit until 2046. By then we'll have flying cars or nuclear winter, but definitely a functional joint venture selling Chevrolet Malibus assembled in Shanghai.
Some retail trader in Michigan just read this headline and thought "finally, a way to play the China reopening trade." He's already calculating his position size. Already imagining the gains. Already forgetting that GM stock has traded sideways for fifteen years while he convinced himself he was investing in innovation.
The Chevrolets built in China won't come to America. They're for "non-U.S. markets." Even GM knows better than to try selling Chinese-made cars to Americans who still think Detroit means something. Those vehicles will go to markets where people don't have the luxury of pretending manufacturing location matters for quality.
Twenty-year joint venture. Could've been ten. Could've been five with options to extend. But no. GM went full two decades. The corporate equivalent of getting someone's name tattooed after the second date.
Photo by James Yarema on Unsplash
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