US parent bankrupt, but GM India plans new carJune 3rd, 2009 - 7:17 pm ICT by IANS
New Delhi, June 3 (IANS) US auto behemoth General Motors Corp may have filed for bankruptcy protection, but its Indian arm is all set for the launch of a new variant of its popular small car Spark.
General Motors India, which operates out of Halol in Gujarat and has a second plant in Talegaon in Maharashtra, will unveil the new model Friday.
GM Corp filed for Chapter 11 bankruptcy protection Monday after a government bailout of $19.4 billion failed to resurrect the 100-year-old auto giant choking under a debt of over $37 billion.
The Chapter 11 process is expected to free the automaker of non-performing assets and liabilities and help it go for restructuring.
The automaker has also agreed to sell off its Hummer sports utility vehicle (SUV) business to China’s Sichuan Tengzhong Heavy Industrial Machinery Co.
However, making slight of what’s happening in the US, the Indian subsidiary remains upbeat with the automaker launching a new Spark model this week.
Moreover, it is also drawing up plans to develop a new Rs.2-lakh small car - its cheapest globally - which will be placed a rung below the Spark.
According to reports, the company plans to make India the lead market for the R&D of the new car, which could also be marketed in South America, Eastern Europe and Africa.
High riding fuel prices in the first half of 2008 crippled demand for the large SUV range that GM had built in the US with considerable investment; it is also one of the biggest reasons for its crash.
The company has already started the process of closing down 14 under-performing plants and other facilities and putting three more on stand-by.
GM is expected to cut 20,000 jobs during this process.
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