General Motors Restructuring International Markets To Strengthen Global Business

Posted May 19, 2017

Volvo's announcement came as General Motors said it will stop selling cars in India, where it has less than a 1 percent share of passenger auto sales. "The EFF has long called on South Africa to build internal industrial capacity and not rely on foreign investments who just leave us when they deem fit", the party said in a statement.

Stefan Jacoby, GM's chief of global operations, said the move to turn the Talegaon assembly into an export-only plant will not impact GM Korea and its position as an export hub.

In a statement released by the company, GM manging director and president Ian Nicholls said: "These decisions were not made lightly".

GM also is the second automaker this week to announce restructuring actions as USA industry sales decline and pressure builds from shareholders to shore up stock prices and shareholder dividends, as well as the growing need to invest heavily to develop autonomous vehicles. Ammann said. "Are we spending time pursuing opportunities ... or all of our time fixing problems?"

GM plans to continue to work on the $5 billion GEM programme, which GM is developing with SAIC Motor.

GM now employs 2,000 South Africans at its plant in Port Elizabeth, their withdrawal is likely to threaten the livelihoods of these workers. GM will cease sales of Chevrolet vehicles in the domestic market by the end of 2017.

Volvo's flagship SUV will be produced from complete knockdown kits at a plant owned by Volvo Group in Hoskote, near Bangalore, in southern India.

GM India started its Indian journey in 1996 and now offers products under the Chevrolet brand in the country. The company now employs about 2,500 workers there.

Volvo Cars will start production of its XC90 in India before the end of the year as part of a drive to double its sales in the market.

However, declining performance has forced GM to focus its India efforts primarily on manufacturing and exporting.

While the Indian premium market is still relatively small, it is forecast to grow rapidly in the coming years.

East Africa: As announced on February 28, Isuzu has agreed to purchase GM's 57.7 percent shareholding in GM East Africa, assuming management control.

GM has announced similar plans for South and East African markets as part of its global business restructuring. The paring down of operations is not confined to India.

Since Barra took over GM in 2014, the one-time largest automaker in the world has taken aggressive steps to narrow its focus to China, the highly-profitable North American light truck and sport utility market, Latin America, vehicle financing and transportation services that ultimately could use autonomous vehicles. GM India saw its sales dwindling from a peak of over one lakh units during 2011-12 to a low of less than 26,000 units in FY17. Total industry sales increased 7 percent in 2016 to 3.3 million, according to LMC Automotive, and sales there are expected to increase 8 percent annually over the next seven years to 6.2 million by 2025.