General Motors India faced its biggest acid test four years ago when its American parent went bankrupt. The management here then pulled out all stops through advertisements and press meets to assure everyone that things were in control.

If that was a tough phase, the present controversy on the Tavera recall will require yet another marathon effort in PR skills. Reports doing the rounds indicate that this is more than just another recall with the Government now setting up a committee to carry out a complete investigation. And if the inquiry throws up any wrongdoing in the emissions exercise for the Tavera, GM India will have a very busy year ahead.

Will this affect customer confidence in the company? “Of late, every automaker has had its share of recalls and dealers have had to work doubly hard to assure buyers that all is well. In the case of the Tavera, this is being accompanied by a lot of publicity,” says a top auto executive.

To that extent, GM India will have its hands full in keeping customer sentiment intact. For a company that has been around for nearly two decades, it just has not been able to clock the kind of numbers that would give rivals sleepless nights.

“Market perception of GM in India is hard to evaluate simply because it has just not created any significant impact so far. Compare this to Hyundai, Honda or Toyota and the difference is all too palpable,” says an industry observer.

This is in sharp contrast to its standing in China where GM is virtually the monarch of all it surveys. It owes a large part of this to local allies such as SAIC Motor Corp which, incidentally, was expected to play a pivotal role in India. This was the time GM had its back to the wall in 2009 and forged an alliance with the Chinese automaker to get it back on track.

Big plans were drawn up, especially in the light commercial vehicle segment. SAIC officials had told Business Line on a visit to China that the India entry could even pave the way for a bigger presence in the ASEAN region. The script changed when a rejuvenated GM bought out a substantial part of SAIC’s stake in the joint venture while the LCV plan was also put on hold.

GM was one of the earliest entrants into India along with Peugeot and Daewoo (which are no longer part of the landscape though Daewoo is now in the GM portfolio). The Opel phase started off promisingly and the global alliance with Suzuki suggested a stronger play in Maruti.

A lot was expected with the new Chevrolet chapter and the Daewoo acquisition but, somehow, big numbers have eluded GM despite promising starts.

(This article was published on July 26, 2013)
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