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GM sets sight on small car market - Views on News from Equitymaster
 
 
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  • Nov 16, 1999

    GM sets sight on small car market

    As per newspaper reports, General Motors (GM), world's premier automobile manufacturer plans to get into the volume segment of the Indian car market dominaed by the small cars in the 1,000 cc range.

    Until a few days ago, GM had a presence in India, through its maiden offering - Opel Astra in the mid-sized segment. It launched its second brand, 'Corsa' also in the mid-sized segment.

    GM plans to increase its presence in the Asia-Pacific region through its to about 10%, from 4.3% at present. It has a 15.7% share of the global market. As far as India is concerned, it is targeting, it is targeting the 1,000 cc, small car segment, which has witnessed explosive growth over the past few months.

    Another move that is being mulled by the company brass is buyout of the government's stake in Maruti Udyog. GM will hit it off with Suzuki considering it has 10% stake in Suzuki Motors Japan. Another option available to the company is a stake in Daewoo India, after having bought its parent, Daewoo Motors Korea.

    While the response to the Opel Astra can at best be described as lukewarm, impact of the Corsa cannot be ascertained at such an early stage. GM's peers Honda (City) and Mitsubishi (Lancer) have fared far better. This seems to imply that GM has failed to invoke consumer interest in the domestic market. Its best bet at this stage is to buy stake in an existing company and leverage on that company's brands, distribution network and service networks.

     

     

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