General Motors wants to launch a new small car in India that is cheaper than its current entry level model, the Chevrolet Spark.
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The automaker wants to introduce the new car in the next two years to capitalise on growth in emerging markets to offset any sluggishness in US sales, a senior company official told the Reuters news agency.
The model would not compete directly with Tata Motors‘ low-cost Nano, David Reilly, GM group vice-president, told Reuters.
The Spark costs about INR300,000 rupees ($US7,350). Tata’s Nano will be priced around $2,500 before tax and delivery charges.
“We need some thing lower than what we have got now. I think if we could find a vehicle less than that, it would not only benefit India but could benefit other places also,” Reilly reportedly said, without saying how much the new model would cost. “But I would not call it an equivalent of Nano,” he added.
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By GlobalDataReilly told Reuters sales growth in emerging markets would outpace any softening in established markets like the United States and would help maintain the firm’s total global sales expansion.
Reuters said General Motors, which has a 3% share of the Indian market, has a manufacturing plant in the western state of Gujarat and is building a second facility near Pune in neighbouring Maharashtra state.
Reilly said the first trial car from the Pune plant, which will begin commercial production in the last quarter of 2008 with an initial production capacity of 140,000 vehicles, would be rolled out on Wednesday.
The company also plans to build an engine plant in India, but Reilly would not share details.
“We are still in some negotiations … We absolutely intend to go ahead with it,” he told Reuters, adding that the company would be give further information within the next two months.
