GM India insulated from trouble to US parent

GM India insulated from trouble to US parent
PTI
Comment E-mail Print Share
First Published: Fri, Nov 14 2008. 07 34 PM IST
Updated: Fri, Nov 14 2008. 07 34 PM IST
New Delhi: Stressing that it is operationally self sufficient, car maker General Motors India on Friday said it is largely insulated from troubles faced by its parent in the US, and its expansions here are on track.
“Whatever is happening in the US, there will be some impact here. But at present, we are operationally self reliant to look after ourselves in India,” GM India president and managing director Karl Slym said.
The company had earlier this year announced a $500 million expansion programme in India for setting up a new small car plant and engine and transmission facility at Talegaon in Maharashtra.
Slym said most of the investments are complete and the engine plant would start production by 2010, while the small car plant would roll out by 2009.
A senior company official said most of the investments were through internal accruals by GMI, and in fact, the Indian subsidiary had started making profits as far back as 2004.
“India is an emerging market, which is immune to a certain degree to the current downturn. We have a strategic plan for the market,” Slym said, adding, the company continues to hold its target of having 10% market share by 2010.
Outlining GMI’s India plans, Slym said from next year onwards the company will “stop import of completely knocked down units and become a full manufacturing company”.
“Also our Talegaon facility will run only in one shift considering the demand here, while Halol will be on two shifts,” he said.
Emphasising the company’s commitments to India, Slym said GMI will launch its luxury sedan Cruze mid next year, followed by the a high-end mini-car expected to be in the Rs4 lakh range, which could come in both petrol and diesel variants. It is also planning to roll out a low cost car by 2010.
As part of its marketing initiatives, GM India has tied up with state-run oil firm Bharat Petroleum Corp Ltd (BPCL) for providing after sales services to its customers at select BPCL workshops.
The company plans to begin services at 15 such outlets, branded as V Care, by this year-end, which would be expanded to 35 next year.
GMI also plans to double its 500-million dollar export business of automotive components by 2010.
“We have already done export business worth $500 million in the past two years. We expect it to be a one billion dollar sourcing firm by 2010,” Slym said.
He said the company might consider locally assembling its sports utility vehicle ‘Captiva’, which is currently sold as a ‘completely built unit’ in the country.
“We had a target of selling 800 Captivas, but we sold over three times of that. At this moment of time, we may look at assembling it as CKD unit,” Slym added.
Slym also denied reports that the parent company in North America was on the verge of filing for bankruptcy.
“There is no bankruptcy going to happen. We cannot be waiting for just government support, as a company we have to help ourselves,” he added.
However, the US auto giant had recently said without government support, the company would run out of cash by June next year.
While announcing its third quarter results, the company had said in a statement: “GM’s estimated liquidity during the remainder of 2008 will approach the minimum amount necessary to operate its business.
“Looking into the first two quarters of 2009, even with its planned actions, the company’s estimated liquidity will fall significantly short of that amount.”
Comment E-mail Print Share
First Published: Fri, Nov 14 2008. 07 34 PM IST
More Topics: GM Motors | Slowdown | Bankruptcy | Home |