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SHANGHAI/DETROIT, Apr 13 (Reuters) Chen Tuansheng clearly remembers the day he went to a General Motors Corp. dealership in Shanghai to buy his prized new Buick.

''It was cold, dark and rainy, but it was the perfect day to get my big, black Buick,'' the 49-year-old engineer purred.

''There was no other car I wanted.'' Embattled GM, which racked up worldwide losses of $10.6 billion last year and is shutting plants and shedding staff at home, hopes more people in China think like Chen.

The U.S. auto icon last year overtook Germany's Volkswagen A.G. as the top foreign car seller in China, the world's second-largest auto market and where GM plans to invest over $3 billion to expand its market share.

GM models accounted for 18 percent of the 3.97 million cars sold in China last year, beating rival Volkswagen's 14 percent.

Most of the U.S. firm's cars were manufactured in the country.

Shanghai's bustling streets bear testament to GM's popularity in China, with Buicks, top-of-the-range Cadillacs and Chevrolets bumper-to-bumper with Volkswagens, Fords and Toyotas -- even though China's drivers pay 250,000 yuan ($31,200) for a Buick LaCrosse sedan, compared with around $25,000 in the United States.

But analysts caution that GM's success in China cannot disguise the company's broader problems. Its vehicle sales in China, including cars and minivans, were only 7 percent of the 9.2 million units GM sold worldwide.

''GM is a very different company outside North America,'' U.S.-based David Healy of Burnham Securities said. ''GM is losing market share here, and gaining it in China.'' ''China is a growing market, an important market for them.

But growth there is not enough to make up for the large losses in North America,'' said Argus Research analyst Kevin Tynan.

CUSTOMER PLEASER Analysts say GM's China growth has been partly due to its ability to launch new cars with customer-pleasing features such as seat-back TV screens.

''Chinese consumers like the larger vehicles that other markets, like Europe or even Japan, are not so comfortable with,'' said Tim Dunne, managing director at Beijing-based Automotive Resources Asia Ltd.

''GM has surprised people with how many models they could bring and how quickly they could do it.'' But, as much as gadgets and a broader model range, analysts say it was Phil Murtaugh -- who joined GM in 1973 and was regarded as a fierce competitor before his abrupt departure as chief last year -- who was pivotal to the drive into China.

Murtaugh helped forge GM's partnership with Shanghai Automotive, which analysts said may have come under strain from the Chinese partner's aim of setting up independent operations.

Chinese auto makers are keen to establish their own brands amid fierce domestic competition, as overall growth in the Chinese market is forecast by GM to slow, hit by Beijing's steps to tighten credit to cool an economy in danger of overheating.

At home, GM has struggled with high labour, healthcare and material costs, loss of market share to foreign rivals and sluggish sales of its once profit-churning Sport Utility Vehicles.

It has sold stakes in three Japanese vehicle makers -- Suzuki Motor Corp., Fuji Heavy Industries and Isuzu Motors Ltd.

-- to raise cash.

But its operations in Asia, where sales topped 1 million cars for the first time last year, seem less troubled -- as is the case for Ford and DaimlerChrysler, GM's big domestic rivals.

GM has said it wants 10 percent market share by 2010 in India, where total sales are expected to double to 2 million cars. GM's unit sales there grew by 17 percent last year.

GM's South Korean unit, GM Daewoo Automotive and Technology Co., aims to increase sales by about a third this year as consumer spending drives an economic recovery.

And, in China, GM executives have forecast their sales will beat overall market growth of 10-15 percent this year.

But the region is no panacea for GM's woes.

''GM has to solve its problems (in the United States) before it can be profitable again. China is not going to bail out the company,'' said Burnham Securities' Healy.

REUTERS PV RAI1120