General Motors Corp, one of the world's top two automakers, said it had yet to regain a competitive edge in the United States while future growth would come increasingly from markets such as China and Brazil.

GM last month agreed a landmark four-year deal for over 73,000 workers represented by the United Auto Workers and is negotiating a new round of buyouts with the union that would go a long way towards restoring GM's competitiveness.

Chief Executive Rick Wagoner told reporters on Monday that the company has already eliminated $9 billion of fixed costs but still had a long way to go.

It has a chance to significantly improve our competitive position, said Wagoner of the new union contract. It is going to play out over a period of several years.

GM lost more than $12 billion in the past two years, and is in the midst of a sweeping restructuring that includes cutting more than 34,000 jobs and closing 12 plants in North America.

The company's global sales rose to a record 2.38 million vehicles in the third quarter of 2007, led by a 14 percent rise in sales outside of North America.

But sales in North America -- GM's largest market, accounting for 44 percent of total sales -- fell 6 percent.

LARGER CHINA FOOTPRINT

Clearly our percentage of sales outside of the U.S. will continue to grow, he said. Ideally, not because our sales in the U.S. shrink.

China has been a bright spot for GM. Last year the car maker sold 876,747 vehicles in China, the world's second-largest market, and expects sales to exceed 1 million this year.

Wagoner said GM will build a scientific centre in Shanghai, as part of its $250 million corporate campus, to carry out advanced research.

It joins a long list of multinational companies that are conducting research in China to tap the country's growing scientific expertise, develop products for the huge local market and gain credit in the eyes of a government determined to climb the technology ladder.

GM makes cars in China with the mainland's biggest car maker, Shanghai Automotive Co Ltd.

The centre will carry out advanced research projects in partnership with the Chinese government, local industry partners and academic institutions, Wagoner said.

Construction of the first phase of the GM Centre for Advanced Science and Research will be completed next year, he said.

In addition to the new science centre, GM said on October 12 that Shanghai General Motors, its venture with SAIC, would spend 1.6 billion yuan ($213 million) on a 5.6 square kilometer (2.16 sq mile) testing ground, China's biggest, in the eastern province of Anhui.

Wagoner said emerging automotive markets such as China and Brazil are posting 20-25 percent annual growth rates.

That is where the opportunity is, that is where the future is, he said, referring to those fast growth markets.

Detroit-based GM competes with Toyota Motor Corp, Volkswagen AG and other global rivals in China, where vehicle output has grown rapidly at an average 26 percent a year from 2001.

(US$=7.4750 yuan)

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