Chevrolet to pull out of India, South Africa

GM to stop selling cars in India but not pulling out

GM to stop selling cars in India but not pulling out

In doing so, it has withdrawn from a race with Toyota Motor, Volkswagen and the Renault-Nissan alliance for the industry's coveted sales crown.

After two decades in the Indian market, GM has little to show in terms of sales and market share.

The moves follow several others in recent years by the Detroit automaker to exit markets it sees as unprofitable.

"After a thorough assessment of our South African operations‚ we believe it is best for Isuzu to integrate our light commercial vehicle manufacturing operations into its African business‚" GM's vice-president of its global operations‚ Stefan Jacoby‚ said in a statement on Thursday morning. GM officials said that while the GEM project will continue as usual for other markets, it is but obvious that the Indian market will not be a part of these plans.

"We determined that the increased investment required for an extensive and flexible product portfolio would not deliver a leadership position or long-term profitability in the domestic market", said GM's executive vice-president and president for GM International Stefan Jacoby. Companies that entered later in India were understanding the consumer much better and quicker but GM somehow developed the knack to not acknowledge the obvious!

The move comes after the company reviewed its performance to analyse its future plans. GM said its exports in India have tripled over the past year so that will remain its focus.

"What are we spending our time doing?"

The group added that Isuzu Motors would also acquire its 57.7% shareholding in GM East Africa, assuming management control.

GM has been working to shore up losses in many countries included in its global operations division. The latter is expected to enter India soon with the MG Rover brand. SAIC cars were Chinese cars with the Bowtie logo on the grille and were being sold in hope that the logo will be enough to convince the consumer. The company said it expects to incur a one-time charge of approximately US$500 million as a result of the restructuring.

GM said it would continue work at its design and engineering center near Bangalore.

The decision follows GM's decision to sell its European division to French automaker PSA Groupe last month, the automaker's decision to discontinue sales of mainstream Chevrolet models in Europe in 2015, to exit Russian Federation in 2015 and end manufacturing in Australia in 2016.

May 18 has turned out to be an interesting day for the Indian automotive market.

The auto sector is a major employment generator accounting for about 29 million direct and indirect jobs in India. GM's volume in India fell by a fifth to 25,823 vehicles in the year ended March 31. It was reported earlier that the American carmaker has shut down their Halol facility and shifted production to the Talegaon assembly plant.

China, of course, has emerged as the largest global market for new vehicle sales. Its market share was a meagre 0.85 percent. GM exported 70,969 units from its Talegaon plant a year ago, thrice its sales in India.

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