The Hindu Business Line : GM may source parts worth $1 b a year from India

SPARKLING SHOW: Chevrolet `Spark' which was launched by General Motors in New Delhi on Tuesday. It is priced at Rs 3.09-3.89 lakhs range. — S. Subramanium

New Delhi April 17 The General Motors Chairman and CEO, Mr Rick Wagoner, who is visiting India after seven years and met with the Prime Minister and industry bodies here, said that the company would source from India components worth $1 billion annually over the next four-five years. Mr Wagoner said General Motors would seek to leverage the country's competitiveness in manufacturing, engineering, research and development to expand its global business.

"We are focussing on leveraging the emerging high quality, low-cost supply base in India. We are not only increasing our local sourcing for local usage but also looking to source more auto components out of India for our global operations," said Mr Wagoner.

Addressing a CII summit, Mr Wagoner said he expected that over the next 10 years emerging markets from Asia Pacific alone would account for 70 per cent of the automotive sales growth, of which India would be the second largest market next to China. Earlier in the day, he met the Prime Minister and discussed the company's willingness to partner the Government's automotive Mission Plan 2006-16 in the next few years to make the sector more competitive.

Mini car production

General Motors would consider exporting from India over the next few years. However, he said that it was currently focussing on meeting supplies for the domestic market. Mr Wagoner said the company initially started its Indian operations in the premium car segment but was now entering the mini car segment, which accounted for over 70 per cent of the domestic market.

The company launched Chevrolet Spark, which it claims to be its most successful model globally.

Chevrolet Spark has a 1000 cc petrol engine and has been priced Rs 3.09-3.89 lakh for its four different models.

The company initially aims to sell 2,000-3,000 units of Spark in a month and these will be rolled out from its Halol facility in Gujarat.

"There will be initial capacity constraints and depending on the demand we will rearrange the product mix to effectively utilise our existing capacity," said GM India President, Mr Rajeev Chaba. The company recently announced setting up a vehicle manufacturing facility at Talegaon, near Pune, in Maharashtra at an investment of over $300 million. It will have an initial production capacity of 1.4 lakh vehicles annually. This takes the company's investment in the domestic market to $750 million.

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