News / Asia

GM Seeks Alternative Supplies in China After Deadly Factory Blast

Medical personnel transport a victim of a factory explosion at a hospital in Kunshan, Jiangsu province, August 2, 2014.
Medical personnel transport a victim of a factory explosion at a hospital in Kunshan, Jiangsu province, August 2, 2014.
Reuters

General Motors said on Sunday that it had asked its main Chinese supplier to find an alternative source of components after an explosion ripped through a factory a day earlier, killing at least 69 people.

The accident at the Zhongrong Metal Products Co. Ltd. plant in Kunshan city, about 1,000 kilometers (600 miles) southeast of Beijing, in the eastern province of Jiangsu.

It is China's worst industrial accident in a year, since a fire at a poultry plant killed 119 people in June last year.

Aside from the fatalities, some 200 people were injured in the blast, state-run Xinhua news agency reported on Sunday, raising its casualty estimate from overnight.

Dangerous dust levels

Chinese investigators faulted poor safety measures for the explosion at the  auto parts factory, with news reports Sunday revealing that workers had long complained of dangerous levels of dust and inadequate cleaning practices at the facility, The Associated Press reported.

City officials said metal dust produced from polishing steel hubcaps ignited Saturday morning, causing an explosion that destroyed almost the entire roof of the plant, according to the AP. More than 200 workers were at the factory at the time of the blast.
 
The metallic dust stuck to the skin of workers, burning between 50 and 90 percent of their bodies, Liu Wei, deputy chief of the health bureau in the city, told the AP.

According to Zhongrong's website, the factory made wheels that are supplied to GM and many other carmakers.

Distancing itself from Zhongrong, the Detroit automaker issued a statement saying it bought components from a company called "Dicastal" - which Zhongrong works with.

GM went on to say it had no direct dealings with Zhongrong, which it described as a "Tier-2" supplier.

Tier-1 component suppliers such as Dicastal are "required to source from Tier-2 suppliers who must meet both in-country environment and safety standards as well as quality standards," GM said.

The U.S. automaker noted that Saturday's accident did not cause any immediate impact on its production because it has "sufficient inventory" of the parts, without specifying what the components were.

"We are working with our supplier to establish alternate processing capability," the statement said.

GM statement

The GM statement said it was "too early to determine the cause of the explosion" as an official investigation was underway.

"We will closely monitor the investigation and, if asked, will provide any resources and information that can assist in this matter," GM said.

The blast was reported to have taken place in a workshop that polishes wheel hubs. A preliminary investigation suggested it was triggered when a flame was lit in a dust-filled room, the local government said on Saturday, describing the incident as a serious safety breach.

Xinhua reported that police took at least two company representatives into custody.

GM described Dicastal as one of its "global suppliers," but did not provide any further information on the company.

Asked if that Dicastal was Citic Dicastal Wheel Manufacturing Co., Ltd., a producer of aluminum alloy wheels headquartered in the eastern province of Hebei and a unit of Beijing-based Citic Group, a GM spokeswoman in Shanghai said she did not have any information.

She also said she had no information on whether GM conducts safety inspections of production facilities run by lower-tier suppliers with which they do not do business with directly.

Some information for this report provided by AP.

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