GM to end sales in India, manufacturing in South Africa

General Motors on Thursday made major announcements concerning its operations in India and South Africa.

The automaker confirmed that it will cease sales in India by the end of 2017, though it will still continue to manufacture cars there for export.

Stefan Jacoby, who heads GM’s unit for emerging markets, said the increased investment required for a full product portfolio in India would not deliver sufficient market share and profitability in the long run.

As for South Africa, GM will sell its share in a commercial vehicle plant to Isuzu. It will also cease sales of its Chevrolet brand in South Africa by the end of 2017.

Stefan Jacoby

Stefan Jacoby

Jacoby said the required investment to maintain manufacturing in South Africa could deliver better returns if invested elsewhere.   

As a result of these actions, GM expects to realize annual savings of approximately $100 million and plans to take a charge of approximately $500 million in the second quarter of 2017.

Since about 2013, GM has been reviewing its global operations in an effort to focus cash and engineering effort on fewer, more profitable markets. Since then, we’ve seen GM pull Chevrolet out of Europe, sell Opel to France’s PSA Group, and announce the end of manufacturing in Australia.

The news comes a day after Ford announced plans to cut 10 percent of its salaried workforce in North America and Asia in an effort to reduce costs amid a slumping share price.

General Motors Renaissance Center in Detroit, Michigan

General Motors Renaissance Center in Detroit, Michigan

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