Limited but ultimately an unlimited market?
Shanghai OnStar Telematics Company opens for business in China this December following an announcement more than two years ago by ousted General Motors Chairman Rick Wagoner.
Since then Toyota, Lexus, Nissan and Audi have offered telematics products to what is now an extremely small private market that is thought to offer great future sales potential.
OnStar services will be available first on some Cadillac, then Buick and finally Chevrolet vehicles as a roll out proceeds during an unspecified period.
This is the first OnStar operation outside of the U.S. and Canada since OnStar was formed in 1995. OnStar claims it is now a global leader in telematics with more than 5.6 million customers and 230 million customer interactions to-date.
The new venture is significant for GM in that it underscores the importance of the emerging Chinese market, now the world’s largest, as well as the need for GM to demonstrate it can expand sales and revenues so that it can pay back Canadian and U.S. taxpayer loans.
However, OnStar declined to provide pricing or sales projections, which could lead to an inference that this is a modest business foray. In the U.S. plans range from $19 to $37 a month.
Shanghai General Motors (SGM) will provide one year of OnStar as standard equipment to customers with OnStar equipped new vehicles. The service will be available throughout mainland China in Mandarin Chinese.
“This underscores SGM’s customer focus and drive for technological progress,” said Ding Lei, President, SGM. “It also improves SGM’s products and services as well as market competitiveness.”
OnStar will provide the following 14 services in China at launch:
- Automatic Crash Response
- Link to Emergency services
- Automatic Airbag Deployment Response
- OnStar Vehicle Diagnostics
- On Demand Diagnostics
- Good Samaritan
- Stolen Vehicle Location
- Remote Door Unlock
- Remote Horn and Lights
- Roadside Assistance
- Hands Free Calling
- Point of Interest
- Turn-by-Turn Navigation
- Destination Download
“Even though the OnStar system utilizes powerful and advanced technologies, it is simple and easy to use,” said Chen Hong, President, SAIC. “OnStar’s human connection makes it uniquely special and differentiates it from any other telematics services in the market. We are delighted to be able to offer this human touch to our Chinese customers.”
Shanghai OnStar is a joint-venture between GM’s wholly-owned OnStar subsidiary (40%) and Shanghai Automotive Industry Sales Company (40%), which is part of the giant SAIC Group, and Shanghai General Motors (20%), which is itself a 50%-50% joint venture between GM and SAIC.