Detroit automaker, General Motors->ke1024, and Chinese company, Shanghai Automotive Industry Corporation (SAIC), started working together a few years ago when GM began building a $250 million facility in China to develop alternative fuels. This loose partnership filled with many projects has provided GM with a lot of monetary benefits throughout these past few years and it seems the benefits will keep on rolling on as these two companies have started another project together. Their newest venture will be the co-developing of a few small engines and advanced transmissions.

The engines will range from 1.0 to 1.5-liter and they will use direct injection and turbocharging technology. They hope that these motors will produce decent power while returning great fuel economy. They will be used in front-wheel drive cars and will be connected to a dry dual-clutch automatic transmission that the two will also be working on.

The products will be developed here in the United States in Michigan and at the joint venture Pan Asia Technical Automotive Center in Shanghai. After development, the engines and transmission will be used in cars throughout the world.

"The GM-SAIC partnership is the most successful one in China's auto industry. There is a big chance that SAIC may take a stake in GM and bring their relationship to the next level," said Sheng Ye, associate research director at industry consultancy Ipsos' Greater China region to Rueters.

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