General Motors to Build New Headquarters in South Korea

General Motors, an American automaker and the biggest player in the global industry, has decided to build its Asia-Pacific headquarters in South Korea, in a further commitment by the company to its loss-making local unit, according to the government on Thursday.

Under a primary deal, the U.S. automaker will also purchase more parts from South Koreans suppliers for its overseas operations, increasing the procurement from about 2 trillion won or $1.85 billion a year at present, the industry ministry stated.

Meanwhile, South Korea will be providing funds to local suppliers of General Motors and other South Korean carmakers for the development of parts for electric and autonomous vehicles.

The statement, however, did not give any figure for the level of support, but according to a ministry official it would be worth combined tens of millions of dollars.

Last month, the U.S. automaker agreed to retain its local arm afloat after it almost seeks for a bankruptcy protection. The firm won major concessions from its labor union on wages and benefits and secured a planned $750 million in funding from state-run Korea Development Bank.

The new regional headquarters will be supervising the production, sales, and technology development for the countries in the Asia Pacific, excluding China, but includes Australia, India, and Thailand.

The U.S. automaker had previously operated its regional headquarters for “General Motors International” in Singapore, which covered South Korea, Australia, Southeast Asia, India, Africa, and the Middle East.

However, General Motors reduced headcount at its headquarter in Singapore in 2017 as part of a restricting to focus on lesser, more profitable markets like China and the United States.

General Motors, on the other hand, has stopped manufacturing in Australia and Indonesia, and the company significantly restricted its Thai operations. The automaker has also restricted its operations in India and South Korea.

FSMSmart gives you the latest news updates, market trends, and news about forex, commodities, stocks and many more! Open an account now and learn more about other investment opportunities on FSM Smart.