SHANGHAI -- For an auto executive in China, one of the most difficult tasks is managing relations with a joint-venture partner.
The key to this task is the art of give-and-take, and one of China's most astute practitioners appears to be General Motors Co.
So it would be worth your time to study the fortunes of SAIC-GM-Wuling Automobile Co., the joint venture that sold more than 1 million minibuses last year.
I thought of this the other day when GM sent me an invitation to attend a press conference on July 18. On that date, the joint venture is expected to introduce a new car brand to complement its fast-selling commercial trucks.
GM is going to make a lot of money from this enterprise because it works harmoniously with its two partners, Shanghai Automotive Industry Corp. and the city government of Liuzhou.
Since it owns only a third of the joint venture, GM can't dictate terms to the others. Nevertheless, Chinese media are reporting that GM will be allowed to expand its stake in this fast-growing company.
How did GM manage this?
The company understands the need for give-and-take. When GM set up this three-way joint venture in 2002, the Detroit automaker received a 34 percent stake, while SAIC and Liuzhou received 50 percent and 16 percent, respectively.
Then GM upgraded the venture's technology and management. With GM's support, Wuling became China's largest minivan maker. Likewise, the city of Liuzhou thrived as the venture generated jobs and revenues.
What did SAIC get? In December, GM allowed SAIC to acquire a controlling 51 percent interest in their other joint venture, Shanghai General Motors Co. That enterprise -- which started out as a 50-50 joint venture formed in 1997 -- continues to grow and expand.
And what's in it for GM? According to media reports, the Liuzhou government already has agreed to transfer much of the interest it holds in the Wuling joint venture to General Motors.
That would be a big win for GM, which plans to rebadge Wuling's minivans as Chevrolets for sale in emerging markets. GM feels good about its prospects, since the company already sells the rebadged minibuses in South America.
"The reception of the product has been outstanding," said Tim Lee, president of GM International Operations during a media roundtable last March in Shanghai.
Now, remember the press conference I mentioned? Wuling's new car brand to be announced on July 18 will feature a mid-sized sedan built on the Buick Excelle platform.
With the backing of two powerful automakers -- GM and SAIC -- Wuling could cut deeply into a market segment previously dominated by domestic Chinese brands.
Another nicely cut deal for GM.