April 27, 2024

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[THE INVESTOR] General Motors will establish an Asia-Pacific headquarters in Korea and push for the manufacturing of key auto parts in its local design and technology center as part of its effort to show long-term commitment to growth in the country, Seoul’s Commerce Ministry said on May 10.

Korea’s Minister of Trade, Industry and Energy Paik Un-gyu and GM International President Barry Engle signed a memorandum of understanding on cooperation for development of Korea’s auto industry.

The agreement came as the Seoul government and the American automaker are set to reach a final agreement on a rescue plan for its local unit that includes the condition the Detroit-based carmaker will remain in the country for at least 10 years.

“GM will newly establish an Asia-Pacific HQ in Korea and push for making GM Korea the hub for manufacturing, sales and technology development,” the ministry said in a release, without elaborating on the specific schedule or the size of the new office.

The Detroit-based automaker runs its international HQ in Singapore, which oversees markets such as Korea, India and Southeast Asia, but it reduced staff last year as part of global restructuring. If established, GM’s Asia-Pacific office will manage businesses in countries in the region except China, the ministry said. 

Under the MOU, the ministry and GM Korea agreed to collaborate on research and development for key technologies for next-generation vehicles, including autonomous driving and electric vehicles. The company, moreover, said more will be done to expand purchases of auto parts from local suppliers.

“The establishment of the regional head office shows GM‘s long-term commitment to its Korean business,” Moon Seung-wook, a senior ministry official, said. “It is expected to help GM Korea have a say when GM HQ assigns new car models.”

GM Korea has served as a key export hub for the US and other countries, but local production fell off after GM decided in 2013 to pull its Chevy brand from Europe.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)