Gm Auto Fin Arm Plans Indian Subsidiary

The car finance subsidiary is present in most of the countries where General Motors has a manufacturing base. In India, the car major has set up a joint venture in association with the C K Birla group, which has an initial capacity of 25,000 cars.

This, said Ronald Nardi, president and managing director of General Motors India, will be expanded to 100,000 units over the next five years. In order to ensure the success of this venture, GM India is already using support services from the Indian unit of Delphi, its world-wide component subsidiary. Similarly, to promote its car venture, it is mulling over proposals to use the lending power of its car finance subsidiary world-wide. The auto finance market in India is already competitive, with major names being Ashok Leyland Finance, Sundaram Finance, Kotak Mahindra Auto Finance, Motor & General Finance, Apple Industries etc.

 

The company has started manufacturing Opel Astra and later plans to widen its product range. A diesel version of the Opel Astra will be launched sometime later next year. It also plans to introduce another model in India in early 1998. Nardi said that General Motors is yet to decide on which model to launch, but said it will be one of the latest ones. "In whichever segment of the market the car is placed, it will be a premium product in that segment," he added.

India figures prominently in General Motors' plans simply due to the fact that it is one of the few countries where demand far outstrips supply, said Nardi. The joint venture has already invested Rs 312 crore on the plant in Halol. For the introduction of every new model an additional cost of around Rs 100 crore would have to be incurred. The level of indigenisation, according to Nardi, for Opel Astra is currently around 50 per cent despite the fact that the engine and transmission equipment is entirely imported.

In order to ensure the success of this venture, GM is using support services from the Indian unit of Delphi, its worldwide component

subsidiary.