General Motors Company said today that it will move its international headquarters from Shanghai to Singapore, a trophy for the tropical city-state that is aggressively promoting itself as a global business center.
The automaker said in a statement that the new headquarters will have about 120 employees to oversee GM's businesses in Africa, Southeast Asia, Australia, New Zealand, India, South Korea and the Middle East, as well as Chevrolet and Cadillac Europe.
GM said it will keep its Shanghai office open with about 250 employees for operations in China, which has overtaken the United States as the world's largest auto market by new vehicle sales.
The move, which is slated for the second quarter of next year, would put GM's international head office closer to important markets without undermining its crucial Chinese business.
Singapore courts multinational companies by touting advantages such as high quality infrastructure, low crime and ease of doing business.
John Zeng, managing director of the forecaster LMC Automotive, said Singapore's low corporate tax is an attraction for international companies and GM's Shanghai office "has got too crowded" with several operations there.
Namrita Chow, an analyst with IHS Automotive, said international companies are turning to emerging markets outside China after a decade of concentrated efforts there. "China now is an established market, and they need to expand to the other markets," she said.
In 2004, GM decided to move its Asia-Pacific regional headquarters from Singapore to Shanghai, then a nod to the rising importance of China to the US automaker.
Several years later, GM set up a division for international operations in Shanghai, but a recent reshuffle split GM China from the international unit, which is seeking a new start, said Lori Arpin, spokeswoman for GM's international operations.
China's appeal for foreign professionals has been diminished by pollution in cities such as Shanghai and Beijing though GM did not cite that as a reason for the shift.
"Singapore would offer closer proximity to our key markets," Arpin said.
