Global economy has been in for a roller coaster ride for a few years and that has affected the strategies of companies. Some companies grow, some survive and some perish. Economic slowdown may bring down the sales but it is considered to be the best time for business acquisition. Some companies acquire new ones while some split up their businesses. The best examples are Volkswagen and General Motors.
The world’s second largest automaker, General Motors has decided to shift its Asia-Pacific Headquarters from Shanghai to Singapore. The headquarter will be making its move by next year second quarter. General Motors; Asia Pacific Headquarters was in Singapore from 1993 to 2003, later shifted to Shanghai in 2004. Now it will be back to Singapore almost after a decade.
General Motors gained a superior position in China and now the country is the biggest customer base for the auto giant. For the last 5 years the average growth rate of GM in China is 27%. Last year the sales chart almost hit a figure of 3 million units (30 lakhs). This decision comes as GM believes it is time for China to have an independent decision making unit. General Motors has recently divided its market into Chinese and non-Chinese. So the non-Chinese sector will shift out to Singapore in the next few months.
The decision has surprised China as Singapore is its arch rival for luring multinational companies to set up Asia Headquarters. General Motors has a good reason to shift to Singapore as the country charges less tax and provides incentives unlike China. China anyhow will be happy as it will be having a dedicated headquarter.
