GM plans to capture 10 pc market share by 2010 Launch of small cars on cards

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Mr Rajeev Chaba, President & Managing Director, General Motors India, at a press meet in Mumbai on Friday. Paul Noronha
Mr Rajeev Chaba, President & Managing Director, General Motors India, at a press meet in Mumbai on Friday. Paul Noronha

Our Bureau

Mumbai, June 17

GENERAL Motors India today said it plans to capture a 10 per cent share in the country's automobile market by 2010 and build up India as a major export base.

The company plans to increase sourcing of products from India from the current level of $120 million to $1 billion, Mr Rajeev Chaba, President and Managing Director, General Motors India, said.

It also plans to introduce two new products every year starting 2006. It has on the anvil a plan to launch a small car.

Even as it plans to increase capacity at its Halol plant from the current 60,000 vehicles to 80,000 vehicles (in three shifts), GM India is considering putting up a greenfield project. The brownfield or the greenfield project would be a necessity in the event of the Daewoo assets not coming GM's way. Mr Chaba said Arcil and the Customs are in the midst of negotiations and should be close to resolutions in the next one or two months. The Daewoo plant has the capacity to make 85,000 units. According to Mr Chaba, the cost of renovation of this plant could equal the cost of an acquisition. "We have done due diligence on its liabilities. But we have not done any study on renovation,'' Mr P. Balendran, Vice-President (Corporate Affairs), GM, said.

Its plans for expansion would largely depend on which direction the Daewoo issue takes. The Matiz has already been launched in some of the Asian markets as Chevrolet Spark.

The launch of a small car is critical to GM if it wants to carve out a 10 per cent share in the Indian market, Mr Chaba said. "Nobody can ignore India. We want to increase our sales to 200,000 vehicles by 2010 and we have the strategy in place to achieve this,'' Mr Chaba said.

GM, he said, has a 14 per cent share globally. "If we have to retain this 14 per cent share in 2020 we may have to open 20 new plants. This is the kind of growth you will see in the automobile market. But we may not open so many plants,'' he said. GM has invested Rs 1,300 crore so far in India.

GM wants to explore the Indian market for unique and niche products. Two products that have a potential in India are Cadillac and Hummer, the off-roader.

Alongside it plans to increase the number of scientists at the Bangalore technology centre from the current 50 to 200 in the next couple of years. "We have some of the best scientists in the world,'' he said.

(This article was published in the Business Line print edition dated June 18, 2005)
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