Topics General Motors | Great Wall Motor | China
David Welch | Bloomberg Last Updated at July 1, 2022 23:36 IST
General Motors Co. has ended its attempt to sell a mothballed plant in India for about $300 million to China’s Great Wall Motor Co. after failing to get government approval to close the deal.
GM had twice extended the terms of the deal to close the sale as the two sides waited for a green light from the Indian government. When the June 30 deadline came and went, the Detroit automaker called off the sale and will instead explore other options, a spokesman said.
The collapse of the deal is the latest snag in GM’s exit from India. The automaker is also stuck in legal challenges from the labor union that represents more than 1,000 former workers at the factory, which claims the layoffs were illegal.
The Indian government has been scrutinizing business ties with China as relations between the two nations become increasingly strained. The economic rivals in the region have also squabbled over territory on India’s northern border, where troops on both sides clashed in 2020.
For GM, the sale of the plant would mark the end of its presence in India. The company canceled a planned $1 billion investment in the market in 2017 and stopped selling Chevrolet vehicles there as part of a broader retrenchment of the automaker’s global businesses. GM Chief Executive Officer Mary Barra also pulled the company out of Russia, Australia, Southeast Asia and South Africa.
Global automakers face a particular struggle to gain traction in India. Consumers favor cheap, compact cars such as those made by Hyundai Motor India Ltd. and Maruti Suzuki India Ltd., and the two companies control around 60% of the market. Toyota Motor Corp. has ruled out any expansion there, and motorcycle maker Harley-Davidson Inc. pulled out in 2020. Ford Motor Co. is also winding down its Indian operations.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance. We, however, have a request. As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed. Support quality journalism and subscribe to Business Standard . Digital Editor
Copyrights © 2022 Business Standard Private Ltd. All rights reserved.
Business Standard is happy to inform you of the launch of "Business Standard Premium Services"
As a premium subscriber you get an across device unfettered access to a range of services which include:
Welcome to the premium services of Business Standard brought to you courtesy FIS. Kindly visit the Manage my subscription page to discover the benefits of this programme. Enjoy Reading! Team Business Standard