General Motors India Private Limited
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GENERAL MOTORS INDIA PRIVATE LIMITED Background contract workers. GM India offers products under GM India has brought the latest manufacturing Founded in 1908, General Motors Corporation is the Chevrolet and Opel brands in the country. processes and human factor practices to its Halol the worldwide leader in car manufacture, with a 15 plant and therefore is the benchmark for advanced Expanding product range through regular new per cent share in the world auto market. It employs technologies in the Indian automotive industry. India product launches about 325,000 people globally. In 2003, GM sold being one of the emerging and fastest growing markets GM India launched its first car model, the Opel Astra, nearly 8.6 million cars and trucks. GM’s global in the region, GM is very serious about this market in 1996. The next model, Opel Corsa, was launched headquarters are at the GM Renaissance Centre in and is exploring various business options in automotive in 2000 and two variants of this model have been Detroit. The GM Group of global partners includes related fields. Though the company was continuously subsequently launched – Corsa Swing in 2001 and Fiat Auto SpA of Italy, Fuji Heavy Industries Ltd., posting losses, it could afford to take a patient Corsa Sail in 2003. Isuzu Motors Ltd. and Suzuki Motor Corp. of Japan, approach as it was supported well by the parent which are involved in various product, powertrain In 2003, the company entered the MUV segment organisation, GM Corp. In fact, GM, through General and purchasing collaborations. In addition, GM is the and launched the Chevrolet brand in India through Corsa and the newly-introduced Chevrolet models Motors Asia Pacific Holdings LLC, has recently largest shareholder in GM Daewoo Auto & the Forester. It also launched the Opel Vectra and of Optra and Tavera. increased investments in GM India for new product Technology Co. of South Korea. GM also has Chevrolet Optra. Vectra and Forester were imported Riding on the growth in volumes, the company also development and capacity expansion. technology collaborations with BMW AG of Germany as CBUs while Optra was assembled in the Halol expects to post a higher turnover of nearly US$ 400 Now, with the industry experiencing growth in and Toyota Motor Corp. of Japan, and vehicle plant. In 2004, the company has launched another million in 2004-05, as against US$ 175 million in the luxury car and MUV segments, the company is manufacturing ventures with several automakers MUV model, the Tavera. 2003-04. It also hopes to make, for the first time, set to leverage its product range and grow at a much around the world, including Toyota, Suzuki, Shanghai The Vectra, Chevrolet Forester and Chevrolet Optra positive operating profits this year. faster rate. Automotive Industry Corp. of China, AUTOVAZ of are positioned in the market place as premium Russia and Renault SA of France. GM has had a long offerings. The Opel Corsa, Opel Swing and Corsa Factors for success High levels of localisation association with India – from 1928 till 1954, it used Sail are for the mainstream market. Production of The company is poised for a turnaround and expects GM India has achieved significant localisation for all its to assemble Chevrolet cars, trucks, buses and batteries Astra has been discontinued from June 2003. quantum growth in volumes and turnover in the products. Its suppliers include domestic and for the domestic market as well as for exports. Since coming years. This confidence stems from several multinational companies located in various parts of then, it has been involved, through an association Supported by network expansion in parallel factors: India covering areas from Chandigarh in the north to with Hindustan Motors, in the production of trucks, To support its growing product line-up, GM India the Cochin-Madras region in the south. The wide cars, automatic gearboxes (Allison) and off-highway has established 57 dealers and 25 authorised service A global parent with a long-term view of the range of localised parts range from stampings to wiring equipment. General Motors India was formed in outlets covering 82 locations across the country. The Indian market harnesses. The stampings, radiators and other 1994 as a 50:50 joint venture between General nationwide network is expected to grow to 120 GM entered India post-liberalisation with a long-term miscellaneous parts are sourced from and around Motors Corporation and the C.K. Birla Group of locations by the end of the year. view; having sensed that future growth in the global Halol and Baroda. The Chevrolet Tavera was launched Companies. Its manufacturing plant is located at Halol, auto market will come from this region. Its approach with a localisation of 85 per cent. The localisation 40 km north of Vadodara in Gujarat. The Halol plant Spurt in sales, powered by new models therefore was to establish a base in India and grow expected to go up to 92 per cent shortly. has received ISO 9002 certification in 1998, ISO The company had experienced moderate to with the market as it matures. 14001 in environment management systems in 1999, reasonable growth from 2001 to 2003, as it The Indian market continues to be dominated by Wide product range ISO -9000 2000 in January 2002. In 1999, GM operated with only two models. However, with the small cars. GM chose to enter the market with higher- GM India can draw from a wide range of global bought out its partner’s shareholding and GM India introduction of new models under the Chevrolet end models that had lower volumes so that its initial products not only from its parent, but also from became a fully-owned subsidiary of GM Corporation. badge in 2003, sales have picked up. While final sales investments were low and margins high. The company associates of GM Corp such as Fuji, Daewoo, etc. The total investment in GMI as of today is figures for 2004-05 are not available, it is estimated has slowly and steadily established a strong This will enable the company to address all segments approximately US$ 252 million. GM India currently that the company has nearly doubled its volume over manufacturing and supplier base, as well as an efficient of the market and to quickly launch products in has a total workforce of 1,200 personnel excluding the previous year, thanks to the growing demand for dealer network. growing volume segments. US COMPANIES IN INDIA Large dealer network projects. The initial focus falls into four areas: math- General Motors India Pvt Ltd: based tools, lightweight materials and robust GM India has upgraded and expanded its dealer AT A GLANCE network. Most facilities are adopting the state of the manufacturing processes, automotive electronics and • General Motors Corporation: Worldwide art 3S integrated facility norms. The company plans to controls systems, and manufacturing enterprise and leader in car manufacture. 325,000 have a presence in 120 Indian cities/towns by end 2005. management science. employees. 86.6 million vehicles sold in On the engineering side, the India team provides Building brand equity through customer math-based tools for GM India, GM Asia Pacific and 2003. Almost 100 years of experience loyalty programs Global Engineering. It relies on computer-aided design, • General Motors India: Manufacturing plant GMI has launched several industry first programs such computer-aided engineering and computer-aided at Halol, Gujarat. Total investment in India: as Opel Club Card facility, Opel Carnivals, Opel manufacturing work. The GMITC engineering team is US$ 252 million. 1,200 employees Autobahn newsletter, chauffeur training programmes, working on product programmes for India, including • Expanding product range through regular mobile road-show caravan, car exchange programme the interiors/exteriors of Tavera, and any future new product launches; Spurt in sales for Opel customers, OK 5-Star used car programme, enhancements. It currently employs some 250 powered by new models. Supported by two-year and four-year warranty schemes, 2 year engineers and acts as a design centre for GM. global expansion in parallel service holiday etc. Such programmes have helped In addition, the GM technical centre also has tie-ups GM in building its brand equity and developing a with a number of technical and academic institutions • Factors for success: Global parent with a loyal customer base. in India. These include institutions like the Indian long-term view of the Indian market. High Institutes of Technology, the Indian Institute of Science, levels of localisation. Wide product range. Leveraging the India Advantage Bangalore etc. These tie-ups are for research projects Large dealer network. Building brand equity in various areas. through customer loyalty programmes Leveraging India’s supplier base • For GM India is: A supplier base. An R&D The company has focused on increasing localisation Future plans hub. An expanding market levels and developing local suppliers, not only to • GM India has invested around over US$ 111 reduce prices of its products, but also to eventually • Future plans, India: Increase production million for expanding its production capacity from source parts from India. capacity to 55,000 units per annum. Increase 25,000 units (the company is geared to sell 30,000 turnover. Have presence in every market GM India, which currently sources engines from its units in 2005) to 55,000 units per annum, segment. Launch the Chevrolet Spark parent’s subsidiaries worldwide, has signed a deal with (working on double shift). Much of that investment the domestic automaker Hindustan Motors to locally has gone into the production of Tavera on which produce engines for Chevrolet Tavera. GM India is banking. • With the recent launch of its new car models and Research and development hub a few others in the pipeline, GM India is on the GM has set up a technical centre at Bangalore and it road to breaking even and profitability this year.