2012 Western India Special: GM India puts LCVs on hold, revs up car plans

General Motors India is revving up its plans to strengthen its passenger vehicle portfolio, but has downshifted gears in its plan to enter the light commercial vehicle market.

GM India was planning to launch LCVs based on Shanghai Automotive Industry Corporation’s (SAIC)-GM-Wuling N200 platform. “We came a long way in doing this but have backed out. Those were the plans but we felt that was not the right architecture at this point. We are going to re-evaluate,” says a person close to the developments.

The common practice of overloading and bad road conditions in various markets in India were apparently the major challenges that made the company take a re-look at its product strategy in the LCV space. Now, “it will more likely be 3-5 years” before GM India enters the commercial vehicle space.



The company is looking at various platforms in the global GM portfolio to enter the highly challenging and competitive small commercial vehicle market, dominated by the Tata Ace, Mahindra Bolero and the fast-growing Ashok Leyland Dost launched just over a year ago. All three account for about 30,000 vehicles every month. “It (the new platform/model) might very well be from North America, if there is a small one there or Brazil, maybe some place else. The company is not leaving anything unturned and is going to look at all the stables to see which suits best,” says the source. The Tavera’s platform may also be considered to build a small CV. “That would be a much better option in many ways,” says the source. The decision will depend on exactly which segment GM wants to play in the Indian commercial segment. It is likely to be higher than a one- tonner as the “one-tonne or the sub-one-tonne is a very tough thing to do,” in the Indian market.

Revving up car plans Even as a team in GM India is busy assessing the best options to enter the CV space, the R&D team is busy in localising the company’s next model – Sail U-VA, set to be launched this month.

The car will debut with a localisation level of 50 percent or a little more. That’s a relatively low level of local content compared to its competitors. The plan is to reach a level of up to 70 percent next year.

“The big thing that we are working on at the moment is the transmission. Because we wanted to give the best drive quality and feel, we have paid premium dollars to import these transmissions. That is something we cannot localise right away. And then we also wanted to enter the market fast and not hold up the launch,” says Ravi Desai, vice-president – engineering, GM India. Desai and his team will also have to localise the new wave of models that are being looked at to plug the gaps. “There are still many gaps, for example, we do not have many vehicles between the Sail and the Cruze and that segment is growing. We have got to look at the entry-SUV, which a hot market now,” says Desai.

Along with new models, GM India is also sprucing existing models. The Spark has been given a facelift. The changes are both in the exterior (twin-port grille, dual-tone front and rear bumpers and some more) and interior (premium upholstery, new door pad design among other changes). The car’s price has been raised by around Rs 6,000. The next to go for a makeover will be the Beat next year.

The Spark’s engine remains the same. But is there an 800cc Spark coming? “We tried to, but at the moment we aren’t in a position to comment if we are going to bring it or not. Studies are in progress,” says Desai.

Currently, the one-litre diesel engine in the Beat in India is GM’s smallest engine. There could be some markets where the engine can go next. GM India says there are emerging markets and if there is a dieselisation in those markets, then maybe there will be an opportunity for the company.

Studies are on for entry into some new segments as well. The sub-four-metre SUV is one among them. Desai says “Right now, we are looking at every option. The sub-four-metre (notchback) becomes a good option. We are studying all of this. We have to look how well the Indian customer accepts cars that are coming in the sub-four-metre category as SUVs. We have to see how they perform.”

How GM performs in the coming years will be decided by the response to its new crop of models, starting with the Sail.

SUMANTRA BAROOAH