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GM pulls Chevrolet out of some world markets

Company restructures operations in India and South and East Africa

Published: May 21, 2017, 10:30 PM
Updated: May 25, 2017, 5:22 AM

Barra India GM

Winners & Losers, January 2016 - WINNER – General Motors – Although its results were far from spectacular, GM's sales were up by 5.3% in January – the only one of the Detroit three to beat the industry average – and enough to bump its market share a couple tenths while theirs declined. Call GM a Winner in January.

General Motors has announced plans to restructure its business worldwide, saving $100 million US annually, turning India into a export market, transferring Africa over to Isuzu, and putting an end to Chevrolet as a worldwide brand.

“As the industry continues to change, we are transforming our business, establishing GM as a more focused and disciplined company,” said GM Chairman and CEO Mary Barra announcing the changes. “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 company began looking at individual markets in 2013, looking to optimize their operations toward the company bottom line worldwide. That meant focusing Indian manufacturing operations on producing vehicles for export only, with the Talegaon plant serving as the hub for vehicles heading to Mexico and Central and South America.

“In India, our exports have tripled over the past year, and this will remain our focus going forward,” said Stefan Jacoby, GM Executive Vice President and President, GM International. “We determined that the increased investment required for an extensive and flexible product portfolio would not deliver a leadership position or long-term profitability in the domestic market.”

In Africa, GM has entered into an agreement with Isuzu Motors to acquire GM’s Struandale plant in and its Vehicle Conversion and Distribution Centre in South Africa, take control of GM’s Parts Distribution Centre also in South Africa, and buy back the remaining shares of Isuzu Truck South Africa (GM had a 30% stake) and GM’s shares in GM East Africa (57.7%) to take over control of the company.

“After a thorough assessment of our South African operations, we believe it is best for Isuzu to integrate our light commercial vehicle manufacturing operations into its African business,” said Jacoby. “We determined that continued or increased investment in manufacturing in South Africa would not provide GM the expected returns of other global investment opportunities.”

With all the changes, GM has announced plans to withdraw the Chevrolet brand from Indian, and African markets by the end of 2017.

"These actions will further allow us to focus our resources on winning in the markets where we have strong franchises and see greater opportunity," concluded GM President Dan Ammann. “We have compelling plans for growth in both the top line and the bottom line as we invest for the future."