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GM plans to set up engine plant in India

General Motors India Ltd will set up a car engine or power train facility in India, reports Suprotip Ghosh.

autos Updated: Nov 04, 2007 22:39 IST
Suprotip Ghosh

General Motors India Ltd, the Indian arm of the largest US automobile maker, will set up a car engine or power train facility in India. “We are going to set up a power train facility in India and are evaluating locations,” said Karl Slym, head, GM India.

GM sells only one of its many badges in India, the Chevrolet. The engine facility would lower GM’s cost of production by allowing it to source cheap parts from Indian manufacturers, said a Chennai-based analyst on the condition of anonymity.

Slym, however, did not elaborate on the investment that GM plans to make in the plant. GM has one plant in Halol, Gujarat, where its Tavera, Optra, Aveo and Spark cars are assembled.

Currently, engines and gearboxes for Chevrolet cars are imported from Southeast Asian countries like Thailand. The new car engine facility will complement GM’s expansion plans in India.

GM India sold 6,139 cars in October 2007, up from 3,153 in October last year. Sales have grown 58 per cent during January-October 2007 over the corresponding period last year.

Slym also indicated that he was considering the option of bringing in GM’s bigger brands like Buick and Cadillac--perhaps even the Hummer--into India, according to bloggingstock, a blog on AOL that tracks corporate developments in India. Right now, GM's India focus is not on the richer brands, but as Slym said, “If there is a business case and a market, then yes,” in relation to bringing the brands to India.

At present, GM's core holdings in India in terms of sales are in the small car segment, similar to its focus in China.