GM East Africa assures of solidity

December 15, 2008
Shares

, NAIROBI, Kenya, Dec 15 – General Motors (GM) East Africa says its regional operations are unlikely to be affected by the problems of its parent company in the US.

GM East Africa Managing Director Bill Lay said on Monday that their operation was one of many global affiliates under the General Motors umbrella, and as such, is independent.

“Given there is no overlap of product portfolios between GM East Africa and the North American market, and the financial independence under which we operate, there are few, if any, implications for the Kenyan market. We are responsible for funding our own operations and do not rely on any direct financial support from North America,” Mr Lay explained.
 
He revealed that 100 percent of GM East Africa’s total volume sold is derived from its own local assembly and from markets outside of North America.

"There is no reason for speculation as to GM East Africa’s ability to provide industry leading sales and after-sales support. Customers can be assured that we will continue to honour our warranty and after-sales commitments,” he said.

Mr Lay noted that GM’s business in Africa had tripled between 2002 and 2007 with sales volumes in Kenya growing by more than nine percent and market share by over three percent through to November this year.

Faced with the looming threat of bankruptcy, US automakers, including GM, fretted on Monday while White House officials studied the sputtering companies\’ finances but reported no moves toward a bailout.

President George W. Bush, who has hinted the government could tap a massive federal rescue package to aid the automakers, said on the way from Iraq to Afghanistan that an agreement on how to remedy the carmakers\’ plight was not imminent.

"We\’re now in the process of working through with the stakeholders a way forward, and we\’re not quite ready to announce that yet," he told reporters aboard Air Force One. But he added that "this will not be a long process because of the economic – the fragility of the autos."

The president\’s remarks came as lawmakers warned that time was running out for the auto giants, and traded blame with auto union chiefs over the collapse last week in the Senate of a short-term rescue bill.

The Detroit Free Press newspaper reported that the size, scope and timing of any lifeline to the automakers was uncertain.

The White House was interested in two conditions, the paper said. The first was a steep reduction by creditors in automakers\’ debt, the second was requiring the United Auto Workers (UAW) union to take half the money due for a retiree health-care trust fund in stock, instead of in bonds or cash.

The Big Three US automakers – General Motors, Ford and Chrysler – have warned of the potential for millions of job losses, which would send ripple effects through the already faltering economy.

Shares

Latest Articles

Stock Market

Most Viewed