New Delhi: One of the early entrants into the Indian market, General Motors Co. on Thursday said that it will cease its sales operations in India and focus on exports from the world’s fastest growing passenger vehicle market.
“The company will focus its GM India manufacturing operations on producing vehicles for export only...,” GM International said in a statement.
Existing Chevrolet customers will continue to be supported in the market, the company said. Across affected markets, GM is working with employees, their union representatives and local authorities to provide transition support.
The move is aimed at driving stronger financial performance and focus its capital and resources on business opportunities expected to deliver higher returns.
GM also said that it will offload its South Africa manufacturing to Isuzu Motors.
GM’s Chevrolet brand will be phased out of both markets by the end of 2017, the company said.
“As the industry continues to change, we are transforming our business, establishing GM as a more focused and disciplined company,” said company’s chairman and chief executive Mary Barra in a statement.
“Globally, we are now in the right markets to drive profitability, strengthen our business performance and capitalize on growth opportunities for the long term. We will continue to optimize our operations market to further improve our competitiveness and cost base,” she said.
These decisions were made following an extensive review of operations in GM International markets and reflect a series of actions taken to improve global business performance that began in late 2013, the company said.
“In India, our exports have tripled over the past year, and this will remain our focus going forward,” he said. “We determined that the increased investment required for an extensive and flexible product portfolio would not deliver a leadership position or long-term profitability in the domestic market,” said GM’s executive vice-president and president for GM International Stefan Jacoby.
GM’s manufacturing facility at Talegaon will continue as an export hub for Mexico and Central and South American markets. It was reportedly in talks with China’s SAIC Corp. to sell its plant in Halol, Gujarat—home state of Prime Minister Narendra Modi.