General Motors is seeking to revive its old dream of building commercial vehicles here. The company now is in talks with China FAW Group Corp. to create a light commercial vehicle joint venture in China.

 

The new venture is tentatively called FAW General Motors Light Commercial Vehicles Co. A General Motors spokesperson says its English name has yet to be finalized.

 

An FAW executive says the joint venture will be equally owned by GM and FAW. It will be incorporated in Changchun, the northeast China city where FAW is headquartered, he adds.

 

The new venture will build manufacturing facilities on the premises of two FAW plants, says the FAW executive.

 

FAW currently runs two existing plants in the southwest China province of Yunnan and the northeast China city of Harbin. It builds Jiefang-badged light trucks and pickups in both plants. It also makes the Happy Move small car and the Freedom Wind van in its Yunnan plant.

 

FAW will inject all the existing products of its Harbin and Yunnan plants into the new venture, says the FAW executive.

 

FAW's Harbin plant has an annual production capacity of 80,000 vehicles, while its Yunnan plant is capable of building 150,000 vehicles a year.

 

"GM China is in talks with FAW on a potential partnership," says Henry Wong, a spokesperson for GM China. He declined to say what models will be made by the joint venture and under what brand.

 

But the FAW executive says FAW's own brand will be retained by the joint venture.

 

Talks between the two sides have made "substantial progress," says an FAW spokesperson. He says details will be released "soon."

 

GM now makes Wuling brand vans and pickups in SAIC-GM-Wuling Automobile Co. in the southwest China region of Guangxi. It owns 34 percent of SAIC-GM-Wuling.

 

Sales of Wuling brand vehicles were 610,033 in 2008, up 16 percent year-on-year, according to Automotive Resources Asia, a unit of J.D. Power and Associates.

 

In 1999, GM set up a 50-50 joint venture with Shenyang Jinbei Automobile Co., a state-owned Chinese company, in the northeast China city of Shenyang. But the venture halted production of Chevrolet brand SUVs and pickups in 2004 after suffering severe losses.

 

GM also builds Buick and Chevrolet cars in its passenger vehicle joint venture with Shanghai Automotive Industry Corp. (SAIC).