General Motors plans to stop selling vehicles in India from the end of this year, drawing the line under more than 20 years battling among the world’s most competitive markets where it has below one percent share of passenger car sales.
The decision was revealed as part of a series of reorganizing actions from the Detroit car manufacturer on Thursday, and marks a significant blow to India’s way of encouraging domestic manufacturing.
The automaker states it would no longer market its Chevrolet brand – its only brand of automobiles marketed in India – despite regardless of India’s promise as a market set to surpass Japan as the world’s third largest in the next decade.
However it has no plans to leave India completely.
It prepares to keep running its tech center in Bangalore and to refocus its India production operations by making one of its two assembly plants in India– the one at Talegaon — into an export-only factory. It prepares to offer the Halol plant in the western Gujarat state to Chinese joint venture partner SAIC Motor.
“We are not giving up advantages India offers as a regional cost production hub with an exceptional supplier base which is incredibly competitive,” Stefan Jacoby, GM’s chief of global operations, stated in an interview.
GM’s exports from India, mainly to Mexico and Latin America, almost doubled to 70,969 automobiles in the fiscal year than ended on March 31. The Talegaon plant has capability of 130,000 automobiles a year.
Jacoby stated the move to turn the Talegaon assembly into an export-only plant will not impact GM Korea and its position as an export center. India will export cars primarily to Mexico and South America, to name a few destinations, while GM Korea will deliver Korean-made automobiles to North America, Southeast Asia, Australia and Pakistan.
