China's SAIC To Buy Stake in GM India?


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No,SAIC won't have a bigger say & no we are NOT getting passenger vehicles from china anytime soon.Only LCV'S come in end of next year.
 
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Re: China's SAIC to buy stake in GM India??

General Motors increases stake in Indian arm to 93 pc

US car major General Motors Co has increased stake in its Indian operations to 93 per cent by buying 43 per cent from its Chinese partner Shanghai Automotive Industry Corporation Group for an undisclosed sum.

"The increase in shareholding in the Indian arm by General Motors is a reflection of the confidence that the company has here and in the long term potential of the country," General Motors India President and Managing Director Lowell C Paddock told PTI.

He, however, declined to comment on the financial details of the transaction.

In December 2009, Shanghai Automotive Industry Corporation Group (SAIC) and General Motors Company had announced expansion of their cooperation in Asia and formed a 50-50 joint venture investment company.

As a result of it, SAIC took 50 per cent stake in General Motors India, which became an equal joint venture between the Chinese automaker and the American automotive giant. Following it, GM India had announced plans to launch a series of vehicles using platforms of the Chinese automaker.

The first of them will be the hatchback Sail, which will be launched next month, followed by the sedan version of the car along with multi-purpose vehicle Enjoy later in December.

When asked if the change in the stake holding in the Indian operations will affect future product pipeline, which are based on SAIC platform, Paddock said: "Not at all. On the contrary, the relationship will continue to strengthen as the GM-SAIC still continues in other Asian market, we will continue to have access to a variety of products."

Earlier in the past, GM India had said it was looking at launching about three models of LCVs from the SAIC platform in India and would also export the vehicles to other markets, mainly in South America and possibly in South East Asia.

General Motors increases stake in Indian arm to 93 pc - The Economic Times
 
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Re: China's SAIC to buy stake in GM India??

Found this interesting piece of facts of GM India

The Indian subsidiary of US auto major General Motors(GM) has run up losses of Rs 746 crore in the last financial year, according to documents the company filed with the Registrar of Companies last week. It sold 1.1 lakh cars last year taking a Rs 67,600 loss on every car sold.

GM entered India in 1995 and was one of the earliest global car companies to woo consumers post liberalisation. But its accumulated losses have since piled up to Rs 1,598 crore, making it one of the least profitable car companies in India. The losses suggest GM is yet to get its India strategy right after 18 years of trials in India and more than a few errors.

Ford, its American peer, which entered India after GM,reported losses of Rs 140 crore in FY12 as against 107 crore in the previous year. It has invested $2bn, which includes a billion dollars in its Sanand plant.

In contrast, Hyundai, the only MNC car maker with sizeable exports and higher indigenisation levels, has seen profits grow from Rs 376 crore in fiscal 2010 to Rs 830 crore two years later. General Motors India's sales are down 20% so far in FY13 and analysts expect the company to report higher losses this year. "The losses (this year) would have aggravated since volumes are falling sharply," said Mahantesh Sabarad, analyst, at Fortune Financials.

Another big loss this year could see General Motors India's accumulated losses inch up close to about half a billion dollars. The company did not respond to a questionnaire emailed by ET.

General Motors has so far invested over a billion dollars here, including $500 million in 2012 to expand the Talegaon plant from 140,000 to 160,000 units and engine capacity from 160,000 units to 300,000 units. But poor off take of its products has limited capacity utilisation to only 38%. Idle fixed assets and the interest burden on it is one reason for the mounting losses.

After starting out with the Opel brand, GM got some traction in the early-2000s when it launched the Optra sedan under the Chevrolet umbrella brand. The multi-utility vehicle Tavera followed a year later, and between 2006 and 2007, the UVA hatch, the Aveo and SRV sub-compacts and the mini Spark rolled out.

By the end of the decade, when it launched its small car Beat, GM, with eight products at different price-points, had the widest portfolio among the multinationals. But it still hasn't been able to hold its own in the Indian market.

GM's first batch of models in India, including Astra, Corsa and Optra, lacked a long term strategy and have since been phased out. Newer products have struggled with poor consumer offtake, frequent price cuts leading to a lack of consumer confidence and poor dealer loyalty.

"GM has not been able to focus on building any particular brand and has not worked to develop a flagship model," said BVR Subbu, an auto industry veteran who has worked with Tata Motors and Hyundai. Even Beat, its largest selling model, only has a 4-6% market share in its segment.

"The problem lies with the Chevrolet brand which doesn't have a connect with the consumer," adds Hormazd Sorabjee, editor, Autocar India. "GM has compromised its brand by frequent price cuts over the last few years."
There’s no end to GM’s woes & losses in India, auto major yet to get its strategy right - The Economic Times
 

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Re: China's SAIC to buy stake in GM India??

It is very difficult to understand their strategy (if there is any).

1. Why they are repeatedly flooding their lineup with outdated looking cars?

2. Why do they focus on only one car at a time (for example beat diesel was their focus point a few months back during 2012)? All other cars become secondary that time. Strategy? LOL

3. Why do they give some horrible discount from time to time lowering the value of their own cars and ruining customer confidence? I bought my Spark LT with a cash discount of Rs 54000/-. Ex-showroom price was Rs.390954, paid Rs.336954 (it was an excellent deal for me). Now, you’ll give Rs.54000/- discount and tell later that you are losing Rs.67,600 on every car sold? What kind of business is that? Stock clearance sale?

4. Their cost cutting measures are strange and without any homework. For example in sail sedan they have placed the power window switches near gear lever. Well…. Again removed 60:40 split seats, rear wipers, body coloured ORVM etc from Spark. Even in recent facelift they didn’t incorporate them again. How would this once decent performer stand the blows from competition this way? Spark is a car with dated look; agree but look GM, M800 still sells well. Why? They don’t have the answer I suppose.

5. They don’t want to understand the customer sentiment. They don’t want to understand that the Indian car market has been changed. It is not the same market 18 years back. People want features, service, brand name and many more. Why someone will buy a Sail sedan instead of Dezire or Verna? Can they justify it? If xyz wants to buy a car in a particular segment which is not from Maruti or Hyundai then what are the options from GM India? What extra features he’ll get in that car? Publishing a comparative chart in newspaper or magazine won’t compel the buyers to go for a Chevy, those are bygone days. They should recruit right people for the task.

6. Most of their dealerships/ ASCs are either present in cities or in big towns. Almost nil rural coverage. You won’t get a Chevvy ASC in a small town. No of ASC/ Dealership is very low compared to other brands. They should learn something from Hyundai at least, forget Maruti.

7. They are plagued by rumors too. Like very costly spare parts and labour charges. This is not actually all true. I can tell this because there are three Chevy cars in my family. One is 5 years (60000Km) old. Similarly, look at Beat and Spark, even after their presence of several years in the market; there are wrong notions among masses regarding space inside these two cars. But there is no add no promo to bust this myth from their end. No customer communication. Nice marketing.

Now, my personal experience in several Auto Expo. The Chevy guys are not serious in marketing their products. Really strange. In the same expo sales guys from TATA, Hyundai, Honda, Mahindra etc will explain everything to you so nicely and just pursue you somehow to avail a test drive.

In India there are millions of buyers with different economic background, taste, knowledge and requirement. Maruti has in its disposal that right product (with continuous revamp) someone may need. They address the requirement of the customers very well. Personally I am neither a Maruti fan, nor loyal to any brand. Honestly I just love two cars from present Maruti stable. The new Swift and Ertiga. Dear GM India, if you don’t know where to head then please atleast try to follow the foot prints of Maruti Suzuki. Do your homework( Case Study: Rise of Maruti Suzuki in India). That’s what as a customer I can say.
 
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SAIC looking to enter India

SAIC looking to enter India by acquiring GM’s Halol Plant

SAIC would become the first Chinese automaker to commence operations if the deal is successful.

SAIC (Shanghai Automotive Industry Corporation), GM’s Chinese partner who owns a small stake in GM India, is reportedly planning to make vehicles in India. The Chinese automaker is conducting a due-diligence of GM India’s Halol plant in Gujarat which is otherwise phasing shutdown by July this year, reports Times Of India.

According to TOI’ sources, if the deal attains fruition, SAIC may start its operations by contract manufacturing cars for GM India. Currently the Cruze, Tavera and Enjoy are being made at Halol plant. The company is reported to be in advanced stages of negotiations with GM India and both entities are keeping the concerned Gujarat government officials in the loop. GM India is said to be working towards passing on the fiscal incentives from the state government to the new buyers.

Once it frees itself from the Halol plant, GM India will concentrate on making its Talegaon operations more productive. The Halol plant has an annual production capacity of 1.1 lakh units and employs around 1,100 people. The new buyer is expected to retain a good number of the existing personnel.

If the GM India-SAIC deal gets finalized, SAIC will become the first Chinese automaker to successfully set up its manufacturing operations in India. SAIC may explore contract manufacturing of more car brands in India or study the market to introduce its own brands in the future.

Source:rushlane
 
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