GM Axes Small Car Plan for Indian Market

GM said on Thursday that they have shelved their plans to introduce a small car in the Indian auto market. the car that was to take on the Nano won’t see the light of day, as GM cited viability issues for axing the small car plan.

The managing director and president of the company, Karl Slym, said that when the NR 1 lakh Nano, was first introduced in the market, they were still discussing their small car plan. They have not yet reached a decision point that would benefit them.

The car was likely to be positioned under their entry level Spark compact car that was already available in the market back then. Slym said that they did have a plan to launch a car smaller than the Spark, but have now dropped plans to enter this segment. As of now, they do not have any decision to go position a model under the category where the Spark is positioned; adding that all of the future GM models in this market will be placed above the Spark.

He said that when the Nano entered the market, there was a lot of talk about its INR 1 lakh price; however this is not the case now, as its price has already been raised. The company’s flagship model, Spark is powered by a 1,000cc motor that is available in both LPG and petrol options. According to the website of the company, the Spark is available between INR 3.01 lakh to INR 4.31 lakh, according to ex-showroom priced in Delhi.

Regarding whether the company would introduce a smaller motor for the Spark, Slym did not confirm whether they would, however he added that they have a powertrain plant that produces a range of different engines.

GM has two production facilities in Talegaon, Maharashtra and Halol Gujarat, and is investing around $500mn or INR 2,200 crore by 2012 end for consolidating their R&D activities, along with increasing their production capacity.

They will also employ around 1,000 more individuals by 2012 as they intend to increase their present production capacity by more than 80% to 4.1 lakh units a year at their two facilities.

GM is expanding its capacity so as to produce CV’s by their SAIC their Chinese partner in India. The first, among a line up of 5 models will be introduced at the 2012 Auto Expo in Delhi.

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