Chevrolet to pull out of India, South Africa

19 May, 2017, 05:23 | Author: Alejandro Stokes
  • General Motors says the move is aimed at driving stronger financial performance and focus its capital and resources on business opportunities expected to deliver higher returns

South Africa (GMSA) sells the Opel, Isuzu and Chevrolet brands in South Africa.

But it doesn't plan to leave India entirely.

The National Union of Metalworkers of South Africa has announced it will consult its lawyers based on suspicions that "shareholders got a very good deal at the expense of workers" following General Motors' announcement it would pull its operations out of South Africa.

Isuzu, GM's joint-venture partner in South Africa, will take over a commercial-vehicle factory and GM's stake in the JV. "Exports will remain our focus going forward as we continue to leverage India's strong supply base", Kazem added. It operates an assembly plant in Maharashtra, where production volumes tripled to about 53,000 vehicles in 2016. "Evidence of this is our recent purchase of GM's 57,7 per cent shareholding in its East African operations, which has given us management control of the company", he said. It is also being reported that the American carmaker is in talks with Mahindra for forging a service agreement where the latter will be responsible for providing service to GM vehicles during the next couple of years. India and China had been slated to be the main manufacturing hubs for the new range that was set to begin production in 2018.

"We explored many options but determined the increased investment originally planned for India would not deliver the returns of other significant global opportunities". CCI has approved SAIC's plan to acquire General Motors' facility in Halol, Gujarat.

The giant has said it is investing around $600m a year as it ramps up efforts to develop driverless vehicles. Many of them also blame the high cost of maintaining and servicing Chevy cars for deterring cost-conscious buyers in India.

By the time they did start speaking about working on a new platform for emerging markets, things had gone down an abyss in India and one of the world's largest carmakers was relegated to a market share of under 1%!

The market leader, Maruti Suzuki, owned by Japan's Suzuki Motor, holds a dominant 40% market share. Now, GM will stop selling Chevys in India entirely by the end of the year.

GM President Dan Anmann said in an interview with Reuters that the restructuring will allow the company to focus more money and engineering talent on expanding the business where the company is more profitable, including markets like China and the U.S.

GM said it would continue work at its design and engineering center near Bangalore.

Sources, however, said the decision would affect a minimum of 200 employees. General Motors has a checkered history in India.

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