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GM Exits India, South Africa in Global Restructuring

May 18, 2017

Photo of Mumbai Sklyine courtesy of Deepak Gupta/Wikimedia Commons.
Photo of Mumbai Sklyine courtesy of Deepak Gupta/Wikimedia Commons.

General Motors will halt vehicle sales in India, the world's second most populous market, and will exit South Africa in a restructuring of its international operations, which includes the phasing out of the Chevrolet brand in both markets by the end of the year.

GM expects to realize annual savings of approximately $100 million with these and other moves.

GM India will now focus on export manufacturing, while Isuzu Motors is planning on purchasing GM South Africa light commercial vehicle manufacturing operations. The decision was designed to drive stronger financial performance, according to the automaker.

“As the industry continues to change, we are transforming our business, establishing GM as a more focused and disciplined company,” said Mary Barra, GM's chairman and CEO. “We are committed to deploying capital to higher return initiatives that will enable us to lead in our core business and in the future of personal mobility."

The decision reflects a series of actions taken to improve global business performance that began in late 2013, according to GM.

GM will continue to utilize its Talegaon plant in India due to a continued growth in exports over the past year, said Stefan Jacoby, executive vice president and president of GM International. The plant will act as an export hub for markets in Mexico and South America.

Meanwhile, the automaker said it was selling its Struandale plant in South America to Isuzu because it believed the market would not provide GM with the expected returns of other global investment opportunities, said Jacoby. Isuzu will also purchase GM’s remaining 30% shareholding in a Isuzu Truck South Africa joint venture, with sales through a national dealer network.

In February, Isuzu agreed to purchase GM’s 57.7% shareholding in GM East Africa. GM also phased out the Chevrolet brand in that market.

The automaker also said that GM International will streamline its regional headquarters office in Singapore. It will retain responsibility for strategic oversight of the remaining regional business and markets, including Australia and New Zealand, India, Korea and Southeast Asia.

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