General Motors to Develop Platform Targeting Chinese Affluent

© Reuters. General Motors (GM) to Develop Platform Targeting Chinese Affluent

By Michael Elkins

An exclusive from Reuters reports today that American carmaker, General Motors (NYSE:GM) is planning to target affluent Chinese consumers with niche, luxury imports using a new direct sales platform called Durant Guild.

Using the platform, the company will host invitation-only events to showcase possible products, open "experience centers" in urban hubs and potentially stage pop-ups at selected sites.

"Durant Guild is not a volume play, but if we do a good job and the products sell well, it will create a lot of buzz around Cadillac and Chevy and will help how people perceive our products and technology," the head of GM in China, Julian Blissett, told Reuters.

Blissett refused to name which cars would be sold through Durant Guild. However, he said to think of U.S. premium models currently unavailable in China such as the all-electric GMC Hummer, Chevy Tahoe, or the Corvette.

Global automakers such as GM, Volkswagen AG (ETR:VOWG), and Toyota Motor Corp (TYO:7203), brands that have dominated the combustion age in China, are falling steadily behind in a booming electric vehicle market. GM hopes that by using a sales and marketing model akin to Tesla (NASDAQ:TSLA) and Apple (NASDAQ:AAPL), it will be able to channel any energy and excitement the imports generate back into GM's existing models in the country.

Chee-Kiang Lim, managing director for China at Urban Science, said a direct sales model such as Durant Guild was a cost-effective way to market cars and maximize profits.

But he said GM should not overlook an even more critical consumer trend, where consumers are increasingly preoccupied with smart, connected features.

"What Chinese consumers want is to extend their digital lifestyles to their cars. Cars from foreign brands designed and engineered overseas are increasingly not meeting these needs," Lim said.

"If Durant can overcome this bias and provide high-tech, personalized features and seamless connectivity to China's digital ecosystems, its odds of success in the China marketplace will be higher."

Durant Guild, which is named after GM's founder William Durant, will be wholly owned, and operated by GM and will launch officially as soon as this month.