SAIC was simply an extension of the Shanghai Municipal government. For these two reasons and more, SAIC grew swiftly. In the 11 years leading to 1996, annual production capacity increased ten-fold to 300,000 units/year, and the company established itself as one of the leading Chinese automakers. During this period, SAIC effectively built an entire modern automotive component supply chain in Shanghai from scratch, and the number and quality of locally produced auto parts rose significantly. Cars that were previously assembled in China from knock-down kits provisioned by Volkswagen became products built from parts produced in Shanghai, and between 1990 and 1996 the city more than doubled its contribution to the national output of automotive components. In 1987, the only local parts used in one car, the Volkswagen Santana, were tires, radio, and antenna, but by 1998 over 90% of the components used in its manufacture were locally sourced. A goal set by the Shanghai Municipal government, creation of a local parts industry is an example of the influence that the local government has had on the development of SAIC. In June 1997, SAIC formed a second major joint venture, Shanghai General Motors Co Ltd, with General Motors. The new joint venture began operations in 1998, and helped to drive a doubling in SAIC's vehicle production between 2000 and 2004. Initially partnering with foreign automakers, creating joint ventures with component suppliers, such as the American Visteon, may now help underpin SAIC success. 2000 to 2010 At the start of the 2000s, SAIC made several acquisitions in Korea. In 2002 it participated in GM's purchase of Korean automaker Daewoo, acquiring a 10% stake in the newly formed GM Daewoo company for US$59.7 million, and in 2004 it also assumed control of an ailing South Korean automaker, SsangYong Motor, paying US$500 million for 48.9% ownership of the company. Around this time SAIC created a new holding company for its subsidiaries employed in passenger car production, Shanghai Automotive Group. In the middle of the decade, SAIC attempted to acquire the British automaker MG Rover, but in 2005 was outbid by another Chinese automaker, Nanjing Automobile. SAIC did manage to obtain some MG Rover technology that was incorporated into a new line of luxury sedans sold under the Roewe marque, and it subsequently purchased the winning bidder. While the company saw sales success in the late 2000s, with 2.72 million vehicles sold in 2009, its