GM India to foray into LCV space

General Motors (GM) India will bring a sub-one tonne truck to the country by the end of next year, thereby marking its entry into the fledgling light commercial vehicle (LCV) space, as a part of its joint venture with China's Shanghai Automotive Industry Corporation (SAIC).

The truck, which will go head to head with the market leader Tata Ace and Mahindra's Maxximo, is one of the five new vehicles that the GM-SAIC combine will introduce to India.

“We will bring three new products in the passenger segment and two in the commercial vehicles segment,” GM India president and managing director Karl Slym said here today.

Although the passenger vehicles will be sold under the Chevrolet brand, the auto maker is yet to take a decision on what badge the LCVs will be marketed. “We will decide on the LCVs once the market surveys are complete,” GM India vice-president (Corporate Affairs) P Balendran said.

India's commercial vehicle segment is expected to grow at about 24 per cent annually and constitutes up to 40 per cent of all automobile sales in the country, Slym said, adding that GM would concentrate on providing “value for money” in the increasingly competitive space.

GM India has facilities at Halol in Gujarat and Talegaon near Pune, which have a combined annual production capacity upwards of two lakh units. The LCVs are expected to be produced at the former facility.

The company is also open to exporting the LCVs, subject to domestic demand, and is likely to focus on the Asia-Pacific region, Balendran added.

But analysts suggested that GM will have to be careful on the pricing of its LCV offering, among others. “In this particular segment, price is very important. Also, they will have to create a dealer network in this space because the customers here are different than those for passenger vehicles. GM will also have to address the brand image as it is partnering a Chinese firm,” IHS Automotive analyst Neeraj Bandhu said.