GM to Pull Out of World's Second Most Populous Country, Sell Off Other Operations in Quest for Cash

In its global push for profitability, General Motors plans to yank the Chevrolet brand out of the hands of Indian consumers.

The automaker announced a wave of restructuring in overseas markets yesterday, a large part of which is the cancellation of nearly $1 billion in investment in India and the pull-out of its only brand. Until recently, GM had hoped to cater to the country’s growing middle class with a new line of region-specific Chevy models.

GM also plans to sell its South African division and cut back on staff in Singapore. The move will help the automaker free up money to funnel towards its biggest markets — North America and China.

The automaker’s overseas operations have struggled in recent years. Just two months ago, it reached a deal with France’s PSA Group to unload its money-losing European Vauxhall and Opel brands. The most recent plans will see it save $100 million per year in unprofitable regions.

“What are we spending our time doing?” GM President Dan Ammann told Reuters. “Are we spending time pursuing opportunities … or all of our time fixing problems?”

Ammann said by cutting back in these markets, GM can focus more senior management time and engineering effort towards its looming truck and SUV “onslaught.”

While Indians can say goodbye to GM vehicles — which faced increasing competition from the likes of Suzuki — the automaker will continue to build vehicles for export to Mexico, Central and South America at its Talegaon assembly plant. The GM design and engineering center in Bangalore will continue operations.

In South Africa, the automaker plans to stop producing Chevrolet vehicles after doing so in the country for 91 years and sell its assembly plant to Isuzu Motors. The Japanese automaker will also buy GM’s 30-percent stake in a joint truck-building operation for an undisclosed sun.

“We determined that continued or increased investment in manufacturing in South Africa would not provide GM the expected returns of other global investment opportunities,” said GM International President Stefan Jacoby in a statement.

Earlier this year, GM announced a pull-out in east Africa, with Isuzu purchasing its 57.7 percent stake in that venture. GM sales in both India and South Africa will cease by the end of the year.

[Image: GM]