Failing to turn around the fortunes of Chevrolet in India, General Motors will shut down its Halol facility in Gujarat by April 2017, 21 years after it rolled out the first Opel car in India.
Chinese automaker SAIC, which plans to enter India soon, will take over the plant’s operations. SAIC, formerly known as Shanghai Automotive Industrial Corporation, has been in talks with GM for a partnership to share assets and make cars.
General Motors, the Detroit-based company, had announced in July 2015 that it will close the facility by mid-2016, but decided to manufacture cars until March 2017 “to ensure an orderly transition for employees, suppliers and other stakeholders”, a national daily reported on Sunday.
Meanwhile, General Motors on Monday announced selling off its two beleaguered European brands -- Opel and Vauxhall -- to France-based PSA Group in a $2.3 billion deal.
“We’re confident that the Opel-Vauxhall turnaround will significantly accelerate with our support,” said Carlos Tavares, chief executive of PSA, in a statement on Monday.
Rise and fall of General Motors in India
The American group entered India in 1995 in partnership with Hindustan Motors, makers of the phased-out Ambassador, to sell the Opel brand in India. After some initial success with the Corsa and Astra, Opel lost appeal as more global brands entered the country.
General Motors then bought the bankrupt Korean auto major Daewoo in 2001, and introduced Chevrolet in India in 2003. But General Motors always struggled to find a strong foothold in the country. It was rather, always a one-trick pony.
After acquiring Daewoo, it made some changes to the popular Daewoo Matiz and launched it as Spark. But Spark could never create the Matiz magic, and as more modern small-cars like the Maruti Suzuki Alto and Zen, Hyundai Santro and then the i10 flooded the industry, Spark lost its spark.
General Motors got some success with the Chevy Beat, premium sedan Cruze and its multi-purpose vehicle Tavera as more Toyota Qualis went left the road. But models like Sail and Aveo, MPV Enjoy and sport-utility vehicles Captiva and Trailblazer had little or no success.
With fledgling market share, General Motors pulled back its $1 billion investment which it had announced in 2015.
(With agency inputs)