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2014-06-21t010355z_2_lynxmpea5k01h_rtroptp_3_gm

General Motors (NYSE: GM) Reels From Factory Explosion In China

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By on Company, Consumer Staples, Technology & Software

Yesterday Sunday August 3rd, an explosion rocked a car part manufacturing factory in China. This factory provides General Motors (NYSE: GM) with parts for its automobiles. The explosion killed 68 workers and injured 187 employees, according to local officials. This explosion is the country’s deadliest industrial accident in over a year.

The accident occurred at 7:37 a.m. local time. The occurrence took place within a workshop that was responsible for polishing wheels, at a factory owned by the Kunshan Zhongrong Metal Products Co. Ltd. The factory is located in Kunshan city in China’s Jiangsu province in the east.

Chinese news station Xinhua covered and reported the story.

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There were over 250 people present at the scene when the explosion occurred. Forty four individuals were killed instantly, and 24 other individuals died on the way to the hospital or after medical treatment failed to save them. More than 130 of the individuals who were injured were sent to hospitals in nearby cities – Wuxi, Suzhou, Shanghai, and Nantong.

Two senior executives are being held responsible for the explosion, and they have been placed under police custody. Safety checks have been ordered by Li Keqiang, the Chinese Premier, and are currently being carried out at other factories.

Zhongrong is a Taiwanese company that was founded in 1998. GM made a public statement shortly after the accident, and confirmed that the factory Zhongrong is a supplier for General Motor’s global supplier, Dicastal.

A news station based in Hong Kong, Phoenix Television, aired footage and cellphone photographs of the explosion. Viewers could see a large plume of smoke escaping from the factory, debris falling from the structures. There was also a truck filled with bodies and many injured survivors with serious burns and wounds waiting outside the gates of the factory on wooden freight boxes.

According to China Daily, the local newspaper run by the government, the government has issued a public announcement asking citizens to give blood and donate provisions for the injured. Medical staff have been deployed from Shanghai to take care of burn victims and treat the injured.

The recent automotive boom in China is due to rising incomes in the country. These overseas sales have contributed to the record high sales that car companies from the United States have been meeting. These car companies, including GM and Ford, have invested significantly in China to manufacture parts for the local market.

Additionally, China’s safety record for its industrial sector has made noticeable improvements in the past few years. There have been a notable reduction in the number of accidents that cause fatalities. However, individual incidents are still common.

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