GM India and Shanghai Auto Ind Corp sign deal

GM India, which is under pressure financially has entered into a joint-venture with China based Shanghai Automotive Industry Corp. The new company, SAIC will be based out of Hong Kong and will focus on business in emerging markets and the Asia-pacific region. GMI, General Motors India will be the first company to come out of this venture. GM will get access to SAIC’s line-up of cars and will get three production lines instead of one.

GM will be purchased by SAIC, which will own  50% of the shares. The final ownership though remains unknown. GMI clarified that the change in ownership, as it were, is not going to change anything on the street in terms of day-to-day operations, dealer and service networks and supplier networks. GM will bring in a 1-tonne LCV in 2011 from SAIC’s range. GM will pick up all models which will suit India and re-engineer to suit local tastes.

The LCV, to be specific, will be manufactured at GMI’s Halol plant. Karl Slym, president and managing director of GMI said, “We manufacture the Tavera at Halol. This gives us the advantage of having the right size paint shops to accomodate an LCV-sized product.” The production of the LCV will lead to some shuffling of car lines with some migrating to the Talegaon plant where GMI has spare capacity.

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