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GM set to launch sedan to take on DZire, Etios

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US-based auto major (GM) is set to lock horns with Japanese rivals (SMC) and (TKM) with the launch of its first entry-level sedan in the country later this year.

GM, which currently straddles the mid-size and executive sedan segments with , and Cruze, would introduce premium hatchback Sail in June/July. A sedan based on the same platform, which would vie for market share with the DZire and the Etios, is set to burn rubber on Indian roads by the end of the year.

, president and managing director, General Motors India (GMI), said, “We will enter the premium economy segment with the Sail in the middle of this year. This segment has been growing strongly, and we are quite confident we have the right attributes to tap into the category. A sedan version of the Sail would follow at the end of the year.”

The new cars from the GM fold have been positioned for launch in categories that recorded the fastest growth amid a slump in the automobile market in India last year. According to industry estimates, 39,000 premium compacts and 20,000 entry-level sedans are sold in the country every month.

, chief general manager (marketing), Maruti Suzuki India Limited, said, “We have over 90,000 bookings for the Swift and another 60,000 for the new DZire launched last month. These segments have grown significantly, despite the overall slowdown in the market.” The company had sold over 227,000 units of the Swift and the DZire between April 2011 and February this year. The two cars together accounted for more than a fifth of the overall sales for Maruti Suzuki.

Toyota, which tipped GM to become the fifth-largest carmaker in India this financial year, sold 63,575 units of the Etios and the Liva in 2011. The Etios series accounted for 47 per cent of sales for the company within a year of launch in the country. Etios today accounts for 28 per cent market share in its category.

GM, which has been battling low sales, is hoping to gain momentum with the new launches this year. Paddock said, “Last year, we saw almost flat growth in sales because we did not introduce any new product in the market. With three new cars and two refreshes lined up for launch this year, we will be able to gain momentum and grow significantly in 2012.”

Apart from the Sail and the sedan, which are expected to cement GM’s footprint in the compact segment, the company also plans to introduce a multi-purpose vehicle (MPV) and upgraded versions of utility vehicle Tavera and sports utility vehicle Captiva this year. The Sail, the sedan and the MPV have been developed by the company and joint-venture partner Shanghai Automotive Industry Corporation (SAIC).

GM, which aims to treble sales to 300,000 units in India by 2013, is considering launching five new vehicles together with SAIC over the next eighteen months. The carmaker has two production plants at Halol in Gujarat and Talegaon in Maharashtra. While the Halol facility has the capacity to roll out 110,000 units a year, the Talegaon plant can manufacture 140,000 vehicles.

GM has a 50:50 joint-venture agreement with SAIC for running operations in all emerging markets in Asia. The GM-SAIC alliance operates eight joint-ventures in China and has also formed an investment company, General Motors SAIC Investment Limited, to facilitate expansion efforts.

General Motors India sold 111,150 cars in 2011, a mere 345-unit growth over the 110,805 units sold the previous year.

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