In a major blow to India's plan of encouraging domestic manufacturing, General Motors Co will stop selling cars in India from the end of this year, drawing a line under two decades of battling in one of the world’s most competitive markets.
The decision was announced as part of a series of restructuring actions from the Detroit automaker on Thursday, and marks a significant blow to India’s strategy of encouraging domestic manufacturing.
This has affected the company’s plans for India too as the sales haven’t picked up in FY 2016-17.
The company sold just 25823 units in the last fiscal year and its market share has dropped below 1 per cent in India.
However, there is a bit of good news for the company as exports saw a sharp climb from 37,052 units in 2015-16 to 70,969 units in FY 16-17. This is one reason why the company will still be using India as an export hub and we will see cars being made in India and shipped out to Mexico and Central and South American markets.
The Talegaon plant has a capacity of 130,000 vehicles a year.
GM it would no longer market its Chevrolet brand in India and this probably means that the Beat and its derivations will not be making its way to the Indian market.
It will, however, keep operating its tech centre in Bengaluru and will refocus its India manufacturing operations by making one of its two assembly plants in India.
It plans to sell the Halol plant in Gujarat to Chinese joint venture partner SAIC Motor Corp.