The Chinese government has also encouraged a shift toward more efficient models through stringent fuel-economy regulations, even as Congress has opted for more subsidies for oil production and a limit on hybrid car subsidies.

.M.'s reward came in the first half of this year, when demand for the utilitarian vehicle market in China soared in response to steep gasoline prices and rising prosperity among peasants and small-business owners. G.M.'s sales of spartan minivans and pickups and of very small cars have climbed faster than those of its rivals, to 172,368 in the first half of this year, up 48.7 percent from the period a year earlier.

Its Asian and Pacific division - just 5 percent of worldwide sales - is increasingly dominated by the fortunes of its China business. The division earned $176 million in the second quarter, even as overall automotive operations lost $948 million amid heavy losses in North America.

The factory here now runs day and night, six days a week. "When the employees stop for lunch, the maintenance people run in," said Yao Zuo Ping, the chief of manufacturing.

Mr. Murtaugh played a central role in 1996 in setting up the company's main operation in China, a 50-50 joint venture with the Shanghai Automotive Industry Corporation, or S.A.I.C. Instead of following the usual G.M. career track of bouncing through assignments around the world every couple of years, he stayed on to run the operation for nearly a decade.

In the late 90's, he noticed that millions of small-business owners and affluent peasants were not yet prosperous enough to afford the latest Western models but were saving enough to acquire more frugal vehicles selling for less than $5,000.

"Essentially, it is his baby," said Stephen Small, the joint venture's G.M.-appointed chief financial officer.

Mr. Murtaugh never learned to speak Chinese, but he was instrumental in setting up the Liuzhou joint venture, which is 34 percent owned by G.M., 50.1 percent by S.A.I.C. and the rest by the Liuzhou Wuling Automotive Company. His personal skills and ability to explain the latest ways to run a factory, often borrowed from Japanese automakers, made a deep impression with executives here, as did his regular visits.

"Murtaugh himself was actually paying a lot of attention to our facility here," said Shen Yang, the president of the joint venture and a leading executive at the factory for more than a decade before G.M. invested here.

To build the cars, G.M. helped gut and rebuild a former tractor factory in ways that could become a model for automobile production in China for years to come.

Long white halls erected in 1958 during Mao's Great Leap Forward still stand here, the paint peeling in places, the wood window frames warped and the windowpanes cracked and broken. Inside, however, is a factory that combines old and new management techniques. Small, plastic racks of parts delivered several times or more a day have replaced large bins of parts delivered to the assembly line in big shipments every few days. This way, the factory can keep low inventories and order quick design changes, if necessary, from nearby suppliers.

The assembly process has only one robot, for sealing windshields, relying mostly on workers earning $60 a month, above average for this impoverished region. That comes after G.M.'s experience in Shanghai, where it installed four dozen robots for its first assembly line only to find them much costlier and less flexible than people; G.M.'s second assembly line there was built with only four robots.

"Low cost doesn't just mean low wages, it means low investment," Mr. Small said.

Worker safety in most Chinese factories is abysmal by Western standards. But workers at the factory here wear safety glasses, and the equipment has automatic cutoffs to prevent workers from losing fingers.

Mr. Murtaugh said in a telephone interview from his home, now in Cadiz, Ky., that he made safety suggestions at the start of his first visit to the factory in 1999. "We got about 20 paces inside the stamping plant and I said to Shen Yang, 'How many eye surgeries and finger amputations do you perform every year?' "

Before the joint venture began to be set up in 1999, Wuling did not even have procedures for handling workers' suggestions. Now, the workers are given extensive information about the performance of their units and encouraged to submit suggestions. The factory received 4,000 suggestions from its 5,000 employees last year, and as many suggestions again in the first five months of this year.

Zhou Libo, a 28-year-old worker who welds minivan underbodies and has worked here for 10 years, said that until the last several years, "We made a lot of parts that were not good quality and had to be thrown away."

Mr. Murtaugh's departure was widely seen within the automotive industry as linked to moves by G.M. that limited his autonomy. Last summer, the company transferred executives from Singapore to an office just down the street from Mr. Murtaugh's in Shanghai, a shift that made closer supervision possible.

Mr. Shen, the president of the joint venture here, becomes visibly emotional when he mentions Mr. Murtaugh's surprise departure.

"I have a very good relationship with Mr. Murtaugh, he is my friend, and seeing him leave is very hard on me," Mr. Shen said, his voice catching slightly. "He was both a teacher and a friend."

Mr. Murtaugh said that he was playing a little golf now, but found himself with many idle hours.

"I'm looking for work," he said, and then joked, "do you have a deck that needs painting?"

__________________
...Tracy

'00 ML320 "Casper"
'92 400E "Stella"