GM to stop selling vehicles in India, focus on exports

Axe likely on 400 employees

​New Delhi: American auto major General Motors (GM) has decided to stop selling its vehicles in India by the end of this year, unable to turnaround its fortunes here after struggling for over two decades to make a mark.

The company will now focus on exporting vehicles from its manufacturing plant at Talegaon in Maharashtra after it stopped production at its first plant at Halol in Gujarat last month.

GM India President and Managing Director Kaher Kazem said at a conference call that “the development will impact 400 employees, which is just about eight per cent of total GM India employees, associated with sales and after sales service,” he said.

Kazem, however, said as the company has to continue its support for existing customers in India, “only half of them are expected to move on by the end of 2017,” while the rest would be involved in after sales support.

Currently, General Motors India employs around 2,500 at its Talegaon plant and an equal number at its GM Technical Centre-India (GMTC-I) in Bengaluru.

Talegaon production capacity currently stands at around 1.3 lakh vehicles a year which can be further expanded to 1.7 lakh units.

GM said the step follows a comprehensive review of future product plans for GM India and is part of a series of actions taken by it to address the performance of its operations worldwide. GM has also exited four other international markets, including Russia and Europe.

GM’s Executive Vice-President and President of GM International Stefan Jacoby said that after exploring many options the company determined that the increased investment originally planned for India would not deliver the returns of other significant global opportunities.

GM’s sales in India were down nearly 21 per cent in 2016 -17 to 25,823 units. Its production however grew about 16 per cent to 83,368 units most of which were exported